Jiangsu Senmao Bamboo and Wood Industry Co., Ltd. v. United States, 435 F.Supp.3d 1278

This appeal concerns Commerce’s First Remand Redetermination following this Court’s Senmao I decision in an antidumping review of multilayered wood flooring from China; Commerce reduced Senmao’s margin from 13.74% to 6.55% mainly by revising surrogate values for inputs and freight.
Commerce deducted an 8% amount from Senmao’s EP/CEP starting prices as “irrecoverable VAT,” invoking the export‑tax adjustment in 19 U.S.C. § 1677a(c)(2)(B).
In Senmao I the Court found record and legal defects in Commerce’s initial VAT treatment and ordered reconsideration; Commerce nonetheless maintained the VAT deduction on remand, arguing it was an export charge and that the adjustment produced a tax‑neutral margin.
The administrative record shows China’s VAT here operates as a domestic (home‑market) value‑added tax: VAT‑in (on materials) is credited against VAT‑out (on combined domestic and export sales), with export sales using a preferential output rate.
The Court held Commerce’s continued deductions for VAT contravened the Tariff Act because the export‑tax provision does not apply to home‑market VAT, set aside that part of the remand redetermination, and ordered a second remand redetermination within 60 days.
The separate question whether Fine Furniture should be treated as a voluntary respondent was held in abeyance pending resolution of related appellate proceedings (Changzhou Hawd).

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §1677a(c)(2)(B) allows deducting Chinese VAT (irrecoverable) from EP/CEP	VAT is a domestic/home‑market tax, not an "export tax"; deduction lacks statutory basis and record support	Irrecoverable VAT is a cost borne by exporter and can be treated as an export charge; adjustment produces tax‑neutral comparison	Court: Export‑tax provision does not cover home‑market VAT; deduction contrary to law; remand required
Whether parties may challenge Commerce’s statutory interpretation on remand	Parties may challenge the new remand decision’s interpretation as a matter of law	Commerce contends remand was factual and plaintiffs shouldn’t add new statutory argument	Court: Parties not precluded; remand redetermination is a new agency action subject to review
Whether Fine Furniture’s claim to voluntary respondent status must be resolved now	Fine Furniture urges reconsideration if appellate outcome revives it under the order	Commerce treats exclusion as currently effective and deems claim moot but will comply if courts revive it	Court: Holds disposition on Fine Furniture in abeyance pending related proceedings

China Manufacturers Alliance, LLC v. United States, 357 F. Supp. 3d 1364 (2019) (held Commerce may not treat Chinese VAT as an "export tax" under §1677a(c)(2)(B))
Qingdao Qihang Tyre Co. v. United States, 308 F. Supp. 3d 1329 (2018) (Chevron step‑one analysis concluding export‑tax provision does not cover domestic VAT)
Jacobi Carbons AB v. United States, 365 F. Supp. 3d 1344 (2019) (upheld Commerce’s VAT adjustment under Chevron step two and discussed tax‑neutrality rationale)
Federal‑Mogul Corp. v. United States, 63 F.3d 1572 (1995) (interpreting home‑market tax adjustments including VAT under earlier statute)
Aristocraft of Am., LLC v. United States, 380 F. Supp. 3d 1324 (2019) (applied export‑tax provision to irrecoverable VAT under a Chevron step‑two framework)