Import Tariffs and Duties

New Reciprocal Tariffs Take Effect August 7: Here's What You Need to Know US importers - major tariff changes are about to hit. CSMS #65829726 confirms the implementation of Reciprocal Tariff Rates under Executive Order 14257 (as amended July 31, 2025), effective August 7 at 12:01 am EDT. Here’s your clear, actionable breakdown: 1. What's Changing New duties apply under HTSUS 9903.02.02–9903.02.71 for countries listed in Annex I. This applies to goods entered for consumption or withdrawn from warehouse on or after the effective date. 2. EU Specific Structure If Column 1 duty ≥ 15%: No additional tariff. Use 9903.02.19. If Column 1 duty < 15%: Total duty adjusted to 15%. Use 9903.02.20. 3. No Change for China China (including Hong Kong & Macau) still faces a 10% duty under 9903.01.25. This remains governed by Executive Order 14298. 4. Exemptions to Know The following are excluded from reciprocal duties: - In-transit goods (loaded before Aug 7, arriving by Oct 5) - Canada (9903.01.26) and Mexico (9903.01.27) - Column 2 countries: Belarus, Cuba, North Korea, Russia - Humanitarian donations, informational materials - Products with ≥20% US-origin content (9903.01.34) - Section 232 materials: steel, autos, copper, etc. 5. Chapter 98 Entries: Not Fully Exempt Most 98 provisions remain duty-free but not all. Duties do apply to: - AGOA (9819) - CBTPA (9820) - FTAs (9822) - Partial duty entries (9802.00.40, .50, .60, .80) - TIBs (9813) must still declare the HTSUS 99 number 6. Transshipment Penalty Defined - This applies when goods are routed through a third country or misrepresented in origin to avoid IEEPA reciprocal tariffs. - If CBP determines origin was misrepresented to avoid duties, a 40% penalty applies in addition to all other applicable duties → Reclassify under 9903.02.01 → Subject to collection at liquidation plus possible fines For full details, refer to CSMS #65829726 on the US Customs Cargo Systems Messaging Service. This summary is designed to help you move faster but always validate against official guidance from US Customs. → Link in the comments. #Tariffs #USCustoms #Trade #SupplyChain

Are you familiar with how tariffs work? Financial and economic literacy should not be optional. When individuals are uninformed or misled, the outcome is disastrous. Let's review how tariffs work economically. A tariff is a tax imposed by a government on imported goods and services. Tariffs are used to regulate trade, protect domestic industries, and generate government revenue. Here's a breakdown. 👉🏾 Types of Tariffs 1. Ad Valorem Tariffs – A percentage of the value of the imported good (e.g., 10% of the price). 2. Specific Tariffs – A fixed amount per unit of the imported good (e.g., $5 per ton of steel). 3. Compound Tariffs – A combination of both ad valorem and specific tariffs. 👉🏾 Economic Effects of Tariffs A. Higher Prices for Consumers Tariffs increase the cost of imported goods, making them more expensive for consumers. Domestic producers may also raise their prices since foreign competition is now more costly. B. Protection for Domestic Industries Tariffs make foreign products less competitive, encouraging consumers to buy from domestic businesses. This can protect local jobs and help specific industries grow. C. Retaliation and Trade Wars Other countries may respond by imposing their own tariffs, leading to trade wars. This can hurt exporters who rely on foreign markets, leading to job losses in export-dependent industries. D. Government Revenue The government collects money from tariffs, which can be used for public services. However, if trade slows down due to high tariffs, the expected revenue may decline. E. Supply Chain Disruptions Many modern industries rely on global supply chains. Higher tariffs can make imported materials more expensive, raising costs for domestic manufacturers. 👉🏾 Example of Tariffs in Action If the U.S. imposes a 25% tariff on imported steel: Foreign steel becomes 25% more expensive. U.S. steel producers gain an advantage as domestic buyers look for cheaper options. However, U.S. car manufacturers (who need steel) face higher costs, which they might pass on to consumers. 👉🏾 Tariffs in Today's Climate U.S.-China Trade Tensions – Both countries have imposed tariffs on each other's goods, affecting technology, agriculture, and manufacturing industries. Inflation Concerns – Higher tariffs can contribute to inflation by increasing the cost of imported goods. Geopolitical Issues – Countries use tariffs as a tool for economic and political leverage. Manufacturing Reshoring – Tariffs can encourage companies to move production back home but at higher domestic production expenses. 👉🏾 Key Take Away While tariffs can protect domestic industries and generate revenue, they also raise prices, disrupt global trade, and trigger retaliatory measures. The economic impact depends on how they are implemented and whether trading partners respond in kind. #KnowledgeIsNotOptional #GoodandBadTariffs

Contrary to what is sometimes claimed, tariffs are taxes paid by importers — not foreign governments or exporters. Here’s how it works: -When a tariff is placed on goods from another country, the U.S. importer pays that tariff when the goods arrive at the border (some process exceptions here). -That cost becomes part of the total landed cost of the product, which can then be: -Absorbed by the importer (reducing their profit), -Passed on to consumers in the form of higher prices, or -Shared with the exporter through renegotiated pricing, though this is less common. Example: If the U.S. places a 15% tariff on goods from Japan: -A U.S. company buying $1,000 worth of widgets from Japan, must pay $150 in tariffs, totaling $1,150. -That $150 in tariffs is paid by the U.S. company buying the widgets. -That $150 goes to the U.S. government, not to Japan. Bottom Line: Tariffs are taxes on imports, and American companies and consumers bear the cost. While tariffs may be intended to pressure foreign governments or protect domestic industries, the immediate financial impact falls on domestic businesses and ultimately consumers.   #imports #tariffs #supplychainmanagement #globaltrade

As we await the possibility of SCOTUS ruling on the IEEPA tariffs, I wanted to share import pricing data showing the effect of tariffs on all-inclusive costs for two categories of imports: aluminum (BEA end use code 14200) and generators, transformers, & accessories (BEA end use code 20000). For each category, the black series represents the BLS's import price index, whereas the red series represents change in import prices coupled with tariffs (calculated as [1 + Effective Tariff Rate]*IPI). Both price series are then set so that 100 = Jan 2025. If the effective tariff rate remains unchanged, the two series would be identical. Thoughts: •For aluminum [top] (which also includes bauxite and aluminum scrap), the IPI increased 3% as of December 2025 from January 2025. However, the effective tariff rate went from 3.4% to 40.8%, resulting in a 40.3% increase in all-inclusive costs. Furthermore, the price of domestically made aluminum products of all types has increased 28% over this period (https://lnkd.in/grZyWgpa). That isn't good news for major users of aluminum (e.g., truck trailer producers, automakers). •For generators and transformers [bottom], all inclusive prices have 12%, with the effective tariff rate jumping from 3.5% to 18%. Many large transformers aren't available in the USA and must be imported, often from the EU. •Interestingly, many of the HTS codes in the generators and transformers category are subject to the §232 steel & aluminum derivative tariffs whereby the steel/aluminum content is subject to a 50% tariff, with the remaining value subject to IEEPA (unless USMCA applies). My sense looking at the effective tariff rate is that the steel content of these goods is actually much lower than the Administration expected. Since §232 is only supposed to apply to the raw value of the steel/aluminum, all the processing steps shouldn't be included. When you then consider other inputs, I expect the raw steel content is about 10% for these goods, if not slightly less. •Building on the last point, The Wall Street Journal has reported the Administration is considering overhauling the §232 steel and aluminum derivatives (https://lnkd.in/gXXHHXsg). My read is this overhaul, if implemented as explained in this article, would bump goods like transformers up to a 25% effective tariff rate. Implication: data such as these are likely one reason why you see the FOMC being more hawkish about inflation concerns in the January meeting than many expected. Keep a close watch for January's producer price index data when it releases next week. For now, it's time to grab a good cup of coffee and start the SCOTUS watch party. #supplychain #shipsandshipping #economics #freight #trucking

Is Cambodia really taxing U.S. goods at 97%? Let’s talk facts, not fear. This image recently surfaced on U.S. television, showing a chart shared by the Trump administration suggesting Cambodia charges 97% tariffs on American imports. At first glance, it’s shocking. But dig deeper, and it becomes clear: the number is misleading and politically charged, not based on any official tariff schedule or WTO-backed data. As someone who imports and operates in Cambodia daily, here’s how tariffs really work for U.S. goods entering the Kingdom: ⸻ How Cambodia Applies Tariffs to U.S. Goods Cambodia is a WTO member and applies the Most Favored Nation (MFN) tariff schedule to countries like the United States, which has no free trade agreement with Cambodia. 1. Import Duty • MFN tariff rates range from 0% to 35%, depending on the product category. • For example: • Mobile phones: 0% • Wines: 35% • Processed foods: 15–35% 2. Value Added Tax (VAT) • A flat 10% VAT is applied to most imports. 3. Special Tax (Excise) • Applies only to specific goods, such as: • Alcohol (10–35%) • Vehicles (10–45%, depending on engine size) • Tobacco (up to 20%) 4. Public Lighting Tax (PLT) • 3%, but only on certain luxury goods. ⸻ Real Example: Importing a Bottle of U.S. Wine HS Code: 2204 • Import Duty: 35% • Special Tax: 35% • VAT: 10% Total tax burden? About 100% — but only on this specific item. Now, consider importing a laptop from the U.S. — • Import Duty: 0% • VAT: 10% • No special taxes. Total tax burden? Just 10%. This is how tariffs are applied: product-by-product, by HS Code, not by country-wide blanket percentages. ⸻ So, where did the 97% number come from? It’s unclear. It doesn’t match Cambodia’s Customs Tariff Book, nor data from the WTO, ASEAN Trade Repository, or Cambodia’s General Department of Customs and Excise. Most likely, it’s a political construct, lumping together: • Import duties • VAT • Special taxes (only for a few goods) • Regulatory “frictions” • Possibly, perceived “trade barriers” But treating it as an across-the-board tariff is disinformation. ⸻ Why It Matters These kinds of graphics may be catchy — but they oversimplify and distort the reality of international trade. We owe it to business leaders, investors, and policy makers to rely on accurate, verifiable data — not scare tactics. Cambodia is not a high-tariff wall against the U.S. In fact, the Kingdom imports millions in U.S. goods every year — and the tariffs applied are fully in line with WTO standards. ⸻ Let’s build smarter trade, not louder headlines. #Cambodia #TradePolicy #Tariffs #USCambodia #WTO #Customs #FactCheck #BusinessInsights

New US trade data is out. The table below shows monthly import values and average applied tariffs for countries with at least $30bn exports to the US in 2025. Some observations: 1️⃣ China faces by far the highest duties. Tariffs in excess of 40 percent led to a drastic reduction in monthly US imports from 41.2bn in January to 17.6bn in June. 2️⃣ Tariffs on the Big-4 European nations vary between 7.9 and 11.8 percent in June. German exports are on the upper end of that spectrum, British ones at the lower end. 3️⃣ Despite having a free trade agreement with the US, Korean exports now face an average applied tariff of 12.4 percent, up from 0.2 percent in January. 4️⃣ Swiss exports of gold have come down a lot, driving overall US imports from Switzerland down to 3.9bn in June, from 23.8bn in January. The average applied tariff of only 4.9% is skewed by pharmaceuticals which so far have been exempted from tariff hikes. 5️⃣ Mexico and Canada - next to China the key source countries of US imports - still face relatively low applied tariffs. From virtually zero percent at the beginning of 2025, rates went up to 2.4 percent (CA) and 4.0 percent (MX). ➡️ Total monthly US imports have decreased from 321bn in January to 258bn in June. Total monthly duties collected went from 7bn in January to 24bn in June. The average applied tariff on all imports increased from 2.2 percent to 9.1 percent. Overall, in 2025 the US imported goods worth $1'758bn and collected $94bn in tariffs. --- All data from USITC: https://dataweb.usitc.gov/

Reciprocal Tariff Rates Modified -- Trade Alert   On August 1, 2025, President Trump signed an executive order (EO) imposing "reciprocal" tariffs ranging from 10% to 41% on imports from dozens of countries. This order came after a period of trade negotiations and threats of tariffs leading up to a self-imposed August 1 deadline.    Key aspects of the EO and related actions include:   ·      Reciprocal Tariffs: The tariffs are described as "reciprocal" because they are designed to match the duties other nations impose on U.S. goods. The new rates were codified in Annex I of the EO and apply to over 60 trading partners.   ·      Delayed Implementation (Mostly): While the original deadline for these tariffs was August 1, 2025, the implementation for most countries has been pushed back to August 7, 2025.   ·      Baseline and Higher Rates: The EO sets a baseline minimum tariff rate of 10% for most trading partners. However, countries with which the U.S. has a trade deficit face a higher starting rate of 15%.   ·      Specific Country Tariffs:   o  Canada: Imports from Canada face a 35% tariff, increased from 25%, effective August 1st. This increase was cited as a response to Canada's failure to cooperate in curbing fentanyl trafficking and retaliation against previous U.S. actions.   o  Brazil: Brazil's goods face a 10% reciprocal tariff, but an additional 40% levy, effective August 1st, was imposed due to the prosecution of its former president, Jair Bolsonaro, bringing the total to 50%.   o  European Union: For goods with a Column 1 Duty Rate of the HTSUS of less than 15%, the sum of its Column 1 Duty Rate and the reciprocal tariff should be 15%. While goods with a Column 1 Duty Rate greater than 15% are subject to a 0% reciprocal tariff.   o  India: India's US-bound exports will face a 25% tariff.   o  Switzerland: Switzerland faces a 39% tariff.   o  New Zealand: Exports from New Zealand to the U.S. are subject to a 15% tariff.   o  Bangladesh: Bangladesh will face a 20% tariff on its goods.   o  China: The EO outlines rates for many trading partners, but China's tariffs will continue to incur separate duties.    o  Mexico: Trade talks between the U.S. and Mexico are extended for 90 days, pushing back the original August 1 deadline when a 30% tariff was set to take effect.   ·      Transshipment: Articles transshipped to evade these additional duties will be subject to (i) a 40% tariff in lieu of the applicable duty rate listed in Annex I of the EO, (ii) any other applicable or appropriate fine or penalty, and (iii) any other duties, fees, taxes, exactions, or charges applicable to goods of the country of origin.   This EO represents a significant shift in U.S. trade policy, replacing a temporary suspension of tariffs with a system based on "reciprocal" rates for various trading partners. 

Keeping up with the constant tariff changes is exhausting. Another wave went into effect today. Here’s some clarity for electronics leaders: 1. “Liberation Day” universal tariffs of 10% or country-specific rates are now live. Low-value and cross-border shipments face standard duties across most origins. 2. Japan & South Korea:  25% tariffs on imports  This applies to memory chips, OLED panels, batteries. U.S.-based production by Samsung, SK Hynix, Micron remains exempt. 3. Taiwan: imports face 20% temporary tariff Electronics still under negotiation pending Section 232 probe results mid-August. This impacts components from TSMC and others unless exemption has been confirmed. 4. India: electronics reprieve for two weeks 25% tariffs start today, August 1st — but electronics exports get a short delay as talks continue. Apple-related assembly partially shielded (for now). 5. China: tariff pause extended until Aug 12 After this date, rates could jump from 10% to ~34%+ if no deal is reached. Trump has claimed discussions are still in progress. 6. Vietnam & Indonesia: partial tariff cap Partial trade deals cap tariffs at ~20% for many goods, but routing scrutiny is increasing to prevent tariff evasion. Lots of electronics moved here in the past two years and might not be a better deal than building in China. 7. Mexico: 25-30% tariffs 25–30% tariffs remain for non-USMCA goods; compliant goods still exempt (for now). What this means: BOM costs shift today. Supply chain, sourcing, and pricing strategies need immediate review. Places that previously didn’t make sense for moves, might make sense again, so take another look. Hang in there folks! #Tariffs #SupplyChain #Electronics

Importing in 2025 feels like playing poker with the government—except the deck is rigged, the dealer keeps changing the rules and you’re always picking up the tab. One day, your cost projections look solid. The next, a new tariff, an adjusted duty rate or some obscure regulation that just made your margins evaporate faster than a politician’s promise. So how do the smart importers avoid getting fleeced? Step 1: Stop Playing Blindfolded Most importers just accept the costs thrown at them. Big mistake. Tariffs, duty rates and customs fees aren’t fixed—they’re a puzzle. 💵HS code classification: Get it wrong, and you might be paying 25% when you could be paying 5%. 💵Country of origin strategy: Some goods qualify for preferential treatment, but only if you know how to work the system. 💵Bonded warehouses & FTZs: Stash your goods in the right spot, and you can defer or even dodge tariffs legally. Step 2: Make Customs Like You You know who doesn’t get their shipments stuck in a bureaucratic black hole? Importers who play by the rules—and play them well. 💵C-TPAT certification: Welcome to the VIP lane. Faster processing, fewer inspections and lower risk of costly holds. 💵Proper documentation: A missing form can mean days of delay and extra fees. Nail your paperwork, or enjoy paying storage costs while customs takes their sweet time. Step 3: Pass the Costs or Get Creative You’ve got two choices: 💵Pass the tariff cost to customers (they’ll love that, right?) 💵Structure your imports smarter so you’re not bleeding money unnecessarily. The best companies are renegotiating supplier terms, restructuring shipments and even tweaking product designs to shift classifications. Tariffs aren’t just a “cost of doing business.” They’re a game—one where the losers pay full price and the winners find every legal way around it. Are you playing to win? Custom Goods ✅ #Tariffs #SupplyChain #CargoMargo

Trade Update: Section 232 Tariffs Expand As of August 18, the Bureau of Industry and Security (BIS) has added 407 Harmonized Tariff Schedule (HTS) codes to the list of products considered steel or aluminum derivative products. • Section 232 tariffs will now apply only to the steel or aluminum content of these products. • Non-steel and non-aluminum content remains subject to reciprocal or other applicable tariffs. • Copper is also now included in the analysis for Section 232 purposes. Compliance requires accurate Bill of Materials (BOM) analysis—not estimates. Companies must: • Conduct a component-by-component review to determine if each part contains steel, aluminum, or copper. • Gather data on value, weight, and origin (e.g., poured, casted, or molded location). • Obtain this information directly from suppliers—secondhand or estimated data won’t cut it. The risks of getting it wrong: CBP is increasing its audits of Section 232 entries. Errors could lead to: • Severe fines and penalties • Retroactive duty assessments on the full product value • Tariffs up to 200% if origin is unknown How KPMG can help: Our team has guided many clients through detailed BOM analyses to ensure compliance and minimize duty exposure. If you’re facing these new Section 232 challenges, we’re here to help. #tariffs #trade