Three Things to Know: May 16th

This week's information compiled by your SC Chamber team includes: 
U.S.–China Announce Pause on Trade War, Sweeping Tax Package Moving in Congress – What’s in it for Business?, SC Chamber Joins Letter in Support of the “Litigation Transparency Act”

 1. U.S.–China Announce Pause on Trade War

Earlier this week, the United States and China jointly announced a 90-day pause on further tariff escalation while the two sides negotiate a more comprehensive trade deal. In announcing the pause, both countries underscored the continued importance of their economic and trade partnership. Treasury Secretary, and S.C. native, Scott Bessent, who negotiated the pause, said this week, “We do not want a generalized decoupling from China. But what we do want is a decoupling for strategic necessities, which we were unable to obtain during COVID, and we realized that efficient supply chains were not resilient supply chains.”

During the pause, both the United States and China have agreed to slash their tariffs on imports from the other country by 115%, which means Chinese imports coming into the United States will have a 30% tariff while American imports going into China will have a 10% tariff. The deal also includes a partial reversal of the de minimis exemption, which allows international exporters to ship packages worth less than $800 to forgo inspection and enter duty-free. The Trump Administration eliminated this exception back in February, but the new deal allows international exporters to either pay a 54% tariff (down from 120%) on packages worth less than $800 or a $100 fee per package.

This is an ongoing situation, and the Chamber will continue to keep members informed of the latest developments.

Have tariffs impacted your business recently? The U.S. Chamber of Commerce is collecting stories from businesses of all shapes and sizes in communities across the country to highlight the impact of tariffs on the business community. Share your story today.

2. Sweeping Tax Package Moving in Congress – What’s in it for Business?

A much anticipated, $3.8 billion tax package is making its way through Congress having passed out of the House Ways and Means Committee earlier this week. The package would permanently extend the provisions of the 2017 Tax Cuts and Jobs Act (TCJA) that were set to expire at the end of this year. Failure to extend these provisions could lead to a 26% tax hike on the average South Carolina taxpayer according to estimates.

The package contains several business priorities including:

• Maintaining the 21% corporate tax rate.
• Expanding and making permanent the 199A small business deduction to 23%, increasing the amount of business income business owners with sole proprietorships, partnerships, and S-corporations can deduct from their federal returns.
• Renewing 100% immediate expensing for domestic research and development (R&D) expenses.
• Restoring 100% bonus depreciation on capital investments.
• Reducing the paperwork burden for small businesses and workers by increasing the 1099-MISC threshold to $2,000.
• No cap on the Business State and Local Tax (B-SALT) deduction.

Estimates show that these provisions would boost short-term gross domestic product (GDP) by 3.3 to 3.8 percent and long-run real GDP by 2.6 to 3.2 percent, unleash $284 billion in economic growth from domestic manufacturing, and lead to the creation of six million new jobs. Other notable provisions in the package include:

• Permanent extension of the $2,000 child tax credit, per child, with an increase to $2,500 until 2028.
• No taxes on tips, overtime pay, and car loan interest on domestic vehicles through 2028, with exceptions.
• A rollback of clean energy tax incentives from the Inflation Reduction Act.

The tax package is part of a broader reconciliation package, dubbed the “One Big Beautiful Bill” by President Donald Trump, that the House Budget Committee is expected to mark up today. Much contention remains on the cap on individual state and local tax deductions (SALT), cuts to state Medicaid funding and work requirements, and cuts to the Supplemental Nutrition Assistance Program (SNAP). Speaker Mike Johnson (R-LA) hopes to hold a vote on the bill next week.

3. SC Chamber Joins Letter in Support of the “Litigation Transparency Act”

Earlier this month, the SC Chamber joined over 265 other businesses, national business associations, and state and local chambers of commerce in a letter to members of the U.S. House of Representatives expressing support for H.R. 1109, the “Litigation Transparency Act of 2025.”

The bill would mandate the disclosure of the presence of third-party litigation funding (TPLF) and underlying funding agreements in federal civil litigation. “The lack of transparency in TPLF allows funders to exert undue influence or control over litigation strategies and settlements, often prioritizing their financial returns of the best interests of plaintiffs,” reads the letter. “This critical piece of legislation seeks to enhance transparency and oversight of third-party litigation funding by putting in place a uniform disclosure requirement of TPLF in all civil litigation.”

The bill, sponsored by Rep. Darrell Issa (R-CA), has been referred to the House Committee on the Judiciary.