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Understanding the Latest Trade Tariff Updates: IEEPA, China, Steel & Aluminum
As global trade regulations evolve, staying informed is crucial to maintaining compliance and minimizing financial impact. The following updates provide essential details on the latest tariff changes, including IEEPA tariffs on Mexico and Canada, increased tariffs on China, and updates on steel and aluminum duties. Please review the information carefully and reach out to WB Skinner Inc. with any questions.
IEEPA Tariffs on Imports from Mexico & Canada
As of March 4, 2025, new tariffs will be applied to imports from Mexico and Canada under the International Emergency Economic Powers Act (IEEPA).
These tariffs are as follows:
- 25% Tariff – Applied to all applicable goods originating from Mexico or Canada.
- 10% Tariff – Applied exclusively to energy products imported from Canada.
These tariffs apply to products of Mexico/Canada, meaning the country of origin determines their application, not the shipping point.
Products Exempt from IEEPA Tariffs:
Certain goods are not subject to the additional tariffs, including:
- Personal Use Goods: – Any items imported for personal use.
- Humanitarian Aid: Donations of food, clothing, and medicine intended to relieve suffering.
- Informational Materials: Books, magazines, and similar items.
- Chapter 98 HTSUS Entries: Goods entered under specific tariff classifications that relate to U.S. processing and repair programs, including:
9802.00.40 & 9802.00.50 – Goods repaired or altered in Mexico/Canada; tariffs apply only to value-added components.
9802.00.60 – Metal articles processed abroad; tariffs apply only to the processing cost.
9802.00.80 – Assembly of U.S. components; tariffs apply only to the foreign assembly value.
9801 – U.S. goods exported and returned from Mexico/Canada (not subject to tariffs).
Other Chapter 98 goods – Generally excluded from tariffs.
Important Considerations:
- No Drawback Allowed: These tariffs are final and cannot be refunded via the duty drawback program.
- No Grace Period for Goods in Transit: All shipments arriving after 12:01 a.m. ET on March 4, 2025, will be subject to the new tariffs, regardless of when they were shipped.
- Foreign Trade Zone (FTZ) Impact:
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- Goods from Mexico/Canada admitted to an FTZ after March 4, 2025, must be in privileged foreign status, making them subject to the applicable tariffs when they enter U.S. commerce.
- Goods admitted under domestic status are exempt.
China Tariff Increases
The U.S. government has imposed increased tariffs on Chinese imports, amending the previous Executive Order.
These increases apply to goods originating from both China and Hong Kong as follows:
- February 4 – March 3, 2025 – A 10% additional duty applies to imports.
- Effective March 4, 2025 – The duty increases to 20%.
Importers must use the appropriate Harmonized Tariff Schedule (HTS) classifications:
- HTS 9903.01.20 – For entries between February 4 and March 3.
- HTS 9903.01.24 – For entries on or after March 4.
Grace Period for Goods in Transit:
A special exemption applies for goods already in transit before February 1, 2025:
- Shipments loaded onto a vessel or other mode of final transport before Feb. 1 may enter duty-free until March 7, 2025.
- Importers should claim HTS 9903.01.23 for these exemptions.
Steel & Aluminum Tariffs
The Federal Register Notices concerning steel and aluminum tariffs will be officially published on March 5, 2025, with key implementation dates and changes detailed below.
Steel Tariffs
- March 12, 2025 – A 25% tariff applies to all original steel products and a new list of derivative products classified under HTS Chapter 73.
- Additional derivative steel products not classified under HTS Chapter 73 will be subject to tariffs once a Commerce decision is made.
- Tariff exemptions apply only to new derivatives that were processed in another country using U.S.-origin steel.
Aluminum Tariffs
- March 12, 2025 – A 25% tariff applies to all original aluminum products and a new list of derivative products classified under HTS Chapter 76.
- Additional derivative aluminum products not classified under HTS Chapter 76 will be subject to tariffs once a Commerce decision is made.
- Reporting Requirements for Importers:
- Importers must report the primary country of smelt, secondary country of smelt, and country of cast for all aluminum products.
Special Tariffs on Russian Aluminum
If any aluminum was smelted or cast in Russia, it is subject to a 200% tariff.
Russian aluminum does not qualify for the same exemptions that apply to other origin goods.
Key Takeaways for Importers
These tariff changes may significantly impact import costs, supply chain decisions, and compliance strategies. WB Skinner Inc. is committed to helping you navigate these regulations and ensure your business remains compliant and competitive.
Next Steps:
- Review Your Supply Chains: Identify which of your imports are affected and consider alternative sourcing options.
- Adjust Pricing & Contracts: Factor in potential cost increases when negotiating with suppliers and customers.
- Work with Compliance Experts: Ensure you are using the correct HTS codes and claim exemptions where applicable.
- Monitor Further Updates: Additional clarifications may be issued by CBP and the Department of Commerce. WB Skinner Inc. will keep you informed of any changes.
Stay up to date with information from the NCBFAA, click here:
- NCBFAA – IEEPA Tariffs Webpage