Updated: April 3, 2025 at 3:30 p.m. ET to reflect the specific exemptions outlined in the unofficial version of the Harmonized Tariff Schedule of the United States (HTSUS) modifications that will implement the reciprocal tariffs.

On April 2, President Trump signed a pair of executive orders as part of a “Liberation Day” ceremony in the White House Rose Garden. The first executive order implements Trump’s reciprocal tariff plan. The second executive order ends the duty-free de minimis exemption for Chinese-origin goods.

Reciprocal tariffs

Effective at 12:01 a.m. (ET) on April 5, 2025, the United States will impose a 10% ad valorem baseline tariff on imports of all foreign-origin goods. This baseline tariff is in addition to any other applicable duties or tariffs.

Effective at 12:01 a.m. (ET) on April 9, 2025, the United States will impose country-specific tariff rates on imports from certain trading partners, which will apply even if goods are imported under a free trade agreement. These rates already include the 10% baseline tariff, so these countries may be able to reduce their tariff rate (e.g., by removing monetary and non-monetary trade barriers, Algeria may be able to reduce its 30% ad valorem tariff rate down to the 10% baseline rate). All other duties and tariffs will also still apply. Thus, imports from China (including Hong Kong and Macau) will also be subject to the existing 20% ad valorem tariffs imposed earlier this year, as well as the Section 301 tariffs.

The country-specific rates included in an annex to the executive order are:

From 12:01 a.m. (ET) on April 5 to 12:00 a.m. (ET) on April 9, imports from these countries will be subject to the 10% baseline reciprocal tariff instead of the country-specific rate.

The Harmonized Tariff Schedule of the United States will be modified to reflect these new tariffs.

If at least 20% of an imported item’s value is U.S. originating, the ad valorem reciprocal tariff will only apply to the non-U.S. content. In this context, “U.S. content” means the value of an article attributable to the components produced entirely, or substantially transformed in, the United States. U.S. Customs and Border Protection will establish a process to collect and verify claims related to the value of an item’s U.S. content.

Exceptions

The new reciprocal tariffs will not apply in the following circumstances:

• Goods loaded onto a vessel at the port of loading and in transit on the final mode of transport before the reciprocal tariffs take effect will not be subject to the baseline or country-specific ad valorem tariffs (as applicable).
• Articles and derivatives of steel and aluminum that are already subject to Section 232 tariffs are excluded.
• Automobile and automobile parts that are subject to Section 232 tariffs at the time of import are excluded.
• Additional articles listed in Annex II to the executive order, including copper, pharmaceuticals, semiconductors, lumber articles, certain critical minerals, and energy and energy products, will be excluded.
• Imports from Belarus, Cuba, North Korea, and Russia (known as Column Two countries) will continue to be subject to their separate duty rates only.
• Future goods subject to Section 232 tariffs will be excluded.
• Canadian- and Mexican-origin goods will not be subject to the reciprocal tariffs as long as Trump’s existing executive orders remain in place. Under those executive orders, the current exemption for goods that qualify as originating under the United States-Mexico-Canada Agreement (USMCA) will also continue.

If the existing executive orders related to Canadian- and Mexican-origin imports are terminated or suspended, goods from both countries will be subject to 12% ad valorem reciprocal tariffs. Those tariffs will not apply to items that qualify as originating under the USMCA, energy or energy resources, potash, or any items eligible for duty-free treatment under the USMCA that are a part or component of an article substantially finished in the United States.

End of the de minimis exemption for Chinese-origin goods

Effective at 12:01 a.m. (ET) on May 2, 2025, the United States will end the duty-free de minimis exemption for imports of Chinese-origin goods (including goods originating in Hong Kong). The de minimis exemption typically applies to goods imported by one person on one day having a fair retail value not exceeding $800.

For goods valued at or under $800 that would otherwise qualify for the de minimis exemption, the duty rates will vary depending on the shipping method:

• For goods sent through means other than the international postal network, all applicable duties and tariffs will be due upon import.
  
• For goods sent through the international post network, the import will be subject to duties of 30% ad valorem or $25 per item (at the transportation carrier’s discretion) in lieu of any other duties, including those previously imposed by executive order. The per item dollar amount will increase to $50 per item on June 1, 2025. Carriers must apply the same duty collection methodology to all shipments but may change collection methodologies monthly.

Next steps

To assess and mitigate the impact of these new tariffs and any counter-tariffs, companies should:

• Review the country of origin, valuation, and classification of their imports. For imports into the United States, country of origin and valuation will be most important for these across-the-board tariffs. Classification will also be important for some of the product-specific carveouts and could be important for counter-tariffs imposed by other countries.
  
• Assess existing contractual provisions to determine which party bears the cost of these tariffs, whether the force majeure or termination provisions can be invoked based on these new government orders, and how surcharges can be used to mitigate the unexpected expenses. Companies may also consider modifying contract templates to reflect these developments and potential counter-tariffs.
  
• Monitor updates in each jurisdiction, including the extent to which the United States grants further exemptions or other countries impose counter-tariffs or reduce monetary and non-monetary trade barriers to try to reduce their country-specific tariff rate.