WHAT’S THE LATEST
On July 31, President Trump signed an Executive Order modifying the reciprocal tariffs on nearly all countries that have not yet reached a trade deal with the United States. These modified tariffs are effective beginning August 7 at 12:01 a.m. ET.
WHAT WE KNOW
Reciprocal Tariffs
- The new tariff rates – ranging from 10% to 41% – that will go into effect for individual countries are detailed in Annex I, with the Harmonized Tariff Schedule of the United States (HTSUS) headings and subheadings used to implement these modifications detailed in Annex II.
- These Annexes reflect a reduced rate of duty for countries that have reached a trade agreement with the U.S. already.
- Any country not listed in Annex I is subject to a 10% additional duty
- Goods of European Union origin were assigned separate rates under the International Emergency Economic Powers Act (IEEPA), depending on whether their Most Favorable Nation rate was over/under 15%
- The effective date of these modifications is 12:01 a.m. ET on August 7, except that goods loaded onto a vessel at the port of loading and in transit on the final mode of transit before 12:01 a.m. ET on August 7, and entered for consumption, or withdrawn from warehouse for consumption, before 12:01 a.m. ET on October 5, shall not be subject to such additional duty and shall instead remain subject to the additional ad valorem duties previously imposed in Executive Order 14257, as amended.
Primary Pending Questions
- U.S. Customs and Border Protection (CBP) has yet to issue implementation guidance.
- Previously released fact sheets for EU and Japan trade deal discuss preferential treatment for certain items subject to Section 232 Automotive duties – further action related to this has yet to be taken.
WHAT'S NEXT?
Our team is available to assist with compliance strategies, risk/duty mitigation, and supply chain strategies. In addition, the tariffs implemented put immense pressure for CBP to ensure the correct country of origin is declared. We recommend importers work to verify that the country of origin declared by supplier is truthful, and proactively review any products where production occurs in multiple countries.
If you have questions, please reach out to your SEKO representative, or email us at hello@sekologistics.com.