Sugar Program: Issues Related to Imports of Sugar-Containing Products

GAO discussed issues relating to U.S. sugar imports and administrative controls over sugar imports. GAO noted that, in 1986: (1) 1.75 million tons of raw and refined sugar entered U.S. commerce via the commodity import quota and 550,000 tons entered through nonquota sugar programs; (2) 265,000 to 307,000 tons of sugar may have displaced domestic sugar by entering the United States in sugar-containing products classified under 46 tariff categories; (3) the amount of sugar in these products was more than double that in 1982; and (4) foreign trade zones (FTZ) imported about 40,000 tons of sugar in blended products. GAO also noted that some businesses have resourcefully circumvented the quota system and its administrative controls by: (1) reclassifying products under nonquota tariff classifications; (2) taking advantage of the Customs Services' inadequate monitoring of sugar entering FTZ; and (3) blending sugar into imported products, exporting the products, and then repurchasing and reimporting the products. In addition, GAO noted that: (1) Customs implemented improvements in its enforcement of the sugar program; and (2) extending import restrictions and rewriting tariff schedule descriptions to eliminate loopholes could limit imports of sugar-containing products.