Layering import duties in a rapidly changing environment

The US government has released three new tariff programs and initiated four more investigations since Jan. 20, 2025, some of which overlap to create additional burden, while others present a web of exemptions. Additionally, the tariff programs from the first Trump administration are still in effect, alongside the Section 301 expansion issued by the Biden administration.

Section 232 national security duties on steel, aluminum, and automotive parts each apply a 25% duty on imports of those products, including steel and aluminum derivative products.

The Automotive Section 232 tariff package has certain broad product codes included, like HS 8471 (computers), that are resolved by only covering “parts of passenger vehicles and light trucks” and serves as an example of some of the nuances of trying to determine the tariff classification of specific goods.

There is the potential for overlapping Section 232 orders, for example, in leaf springs (7320.10), where there is potential for double duties to be applied if the product is a part of a vehicle. The relevant passage to look for in Section 232 notices usually reads, "The above ad valorem tariff is in addition to any other duties, fees, exactions, and charges applicable…"

Reciprocal duties

The "reciprocal" International Emergency Economic Powers Act (IEEPA) duties apply their own set of exemptions and rules by country, with most countries receiving a 90-day deferral of the reciprocal duties above 10%, except for mainland China, which has a 125% rate.

The reciprocal duties have an exemptions list that contains goods like computers, minerals, and wood, with the government indicating that some of those products will be subject to Section 232 investigations in the future, while also carving out any products that are already impacted by Section 232 duties.

Canada, Mexico, and China also have fentanyl-related IEEPA duties, at 20% for China and 25% for Canada and Mexico, with Canada and Mexico having USMCA-related carve outs.

Another factor is a list of energy and mineral products from Canada that receive a lower 10% duty. The carve outs for USMCA products are temporary and are nominally in place until a process is established to tariff only the non-US content of the product.

Section 301 duties

Finally, when looking at China, the Section 301 duties on four tranches of products still apply, with List 1 through List 3 being 25% and List 4A being 7.5%. The Section 301 expansion in 2024 adds an additional variable to check with various duties for specific products. These are also additive to any other duties that may be applied.

Other programs have been implemented with no known duty application so far, like the secondary tariffs on Venezuelan oil purchases. Products may also be subject to other anti-dumping/countervailing subsidy duty programs applied as part of prior trade investigations. 

Consider the impact of the multiple duties across a single product — in this case 9507, or fishing rods from China as of April 14. First, some products under that product code are subject to the Section 232 case on aluminum, and because we are not providing a more specific code there are a range of outcomes, between 0% and 25% added at that step.

Then there are the reciprocal tariffs, which from China are 125%. Some products are eligible for the Section 232 exemption, however, so the added range is 0% to 125%. The fentanyl-related duties add a final 20%, while the product does not appear on Section 301 lists 1 through 4a. The final estimated range is 45% to 145% of additional duties, not including any potential base rates, antidumping, countervailing, or safeguard duties.

The process can be repeated for other products, with some exhibiting elevated and potentially wide-ranging tariffs from mainland China including medical devices (145% to 195%) and semiconductors (45% to 195%).

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.