Reciprocal Tariff Rates Higher on Specific Countries

President Trump made a sweeping announcement on April 2, 2025 regarding new tariffs and reciprocal tariffs on all goods imported into the U.S. While we await formal notices in the Federal Register, additional revisions to the U.S. International Trade Commission in the Harmonized Tariff Schedule or HTSUS, and U.S. Customs and Border Protection guidance, we have prepared the following summary from yesterday’s press conference below.  Please note that many aspects of the Executive Order are subject to interpretation, so A.N. Deringer, Inc. is monitoring all regulatory notices, including those forthcoming in the Federal Register, and we will update our customers and partners as revisions and clarifications become available.

On April 2, 2025 U.S. President Donald Trump announced a new, additional tariff rate of 10% on all goods arriving from all countries, effective at 12:01 A.M. EST, Saturday, April 5, 2025. (The new tariff will not be applied if goods were “loaded onto a vessel at the port of loading and in transit on the final mode of transit before 12:01 A.M. EST on April 5, 2025.”) The new ad-valorem duty is in addition to other duties previously imposed.

Reciprocal Tariffs

The President also announced specific ‘reciprocal’ tariff rates beyond the 10% duty for roughly 60 countries delineated in Annex I, including China, which encompasses Hong Kong, and Macau. The additional tariffs listed “include the 10% baseline tariff. For example, the reciprocal tariff for China is 34%, which is the 10% base tariff that enters into effect on April 5th plus the 24% China specific reciprocal tariff that enters into effect on April 9th.”[1] 

• Canada and Mexico are notably unaffected by the reciprocal tariffs, which means that “USMCA-compliant goods will continue to see a 0% tariff.” Non-USMCA compliant goods will continue to see a 25% tariff, and non-USMCA compliant energy and potash will continue to see a 10% tariff. “In the event the existing fentanyl/migration IEEPA orders are terminated, USMCA-compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff.”

Exemptions

Annex II to the Executive Order lists goods, by eight-digit HSTUS code that are also exempt. Notable exemptions include:

• Articles encompassed by 50 USC 1702(b) – these are items such as donations, information/informational materials, accompanied baggage, etc.
• Goods such as:
  • Steel and aluminum articles and their derivatives subject to Section 232 tariffs
  • Autos and auto parts subject to Section 232 tariffs
  • Copper
  • Pharmaceuticals
  • Semiconductors
  • Lumber articles
  • Certain critical minerals
  • Energy and energy products, and
  • Goods subject to Section 232 tariffs in the future
• Goods with “U.S. content.” If a good has at least 20% U.S. content, then the 10% and country specific tariffs will only be applied to the non-U.S. content. The Executive Order defines “U.S. content” as “components produced entirely, or substantially transformed in, the United States.”
• Articles from countries subject to the Column 2 duty rates in the HTSUS (North Korea, Cuba, Belarus, Russia)

 HTS Update

Annex III to the Executive Order sets forth the HTSUS Chapter 99 provisions that will need to be utilized to report and pay the 10% baseline tariff starting on April 5th (9903.01.25) as well as the Chapter 99 provisions for the country specific reciprocal tariffs that start on April 9th (9903.01.43 through 9903.01.77).

Foreign Trade Zones

Another notable issue in the Order is a requirement that articles subject to the new reciprocal tariffs that are entered into any foreign trade zone should be entered in “privileged foreign status”; but the Order is silent on the use of drawback.

We will be hosting a webinar addressing the Liberation Day tariffs on April 10, 2025 with special guest Trade Attorney Michael Roll. Please register here.

Due to the rapidly changing application and modifications of duty rates, please note that Deringer is not responsible for coordinating the timing of U.S. entry and imposed tariff rates.

[1] Roll & Harris, LLP Tariff Update, April 3, 2025.