Hello Customers, Colleagues, and Friends,
We are writing to inform you of significant tariff changes announced by President Trump, which are set to take effect April 5, 2025, and to help you understand their potential impact on your business operations.
New Tariffs on Imports – Universal 10% Tariff
Effective April 5, 2025, a universal 10% tariff will be imposed on all imports from all countries. This action follows the declaration of a national emergency due to large and persistent trade deficits. This tariff will apply to goods from every country, without exception. It is still unclear whether this will replace the standard rates of duty or will be implemented in addition to the standard duty rates. Assume the latter.
Country-Specific Tariffs
In addition to the 10% universal tariff, country-specific tariffs will be applied to imports from certain countries with the largest trade imbalances with the United States. These tariffs will take effect on April 9, 2025, and will remain in place until the President determines that the economic harms identified have been mitigated. This is an extension of Trumps IEEPA tariffs that were previously specific to China, Canada and Mexico.
Importers should review the Annex I of the Executive Order to identify the specific countries and goods that will face higher tariffs. These countries were listed on the chart President Trump displayed at the announcement.
Exemptions
- Articles subject to Section 232 tariffs (steel, aluminum, and automotive parts already subject to tariffs under Proclamation 9704, 9705, and 10908).
- Critical items such as copper, pharmaceuticals, semiconductors, and energy products.
- USMCA-compliant goods from Canada and Mexico will continue to be eligible for preferential tariff treatment, while non-USMCA goods from these countries will face additional duties.
- Energy and potash from Canada (non-USMCA) will face a 10% tariff.
China-Specific Changes – Elimination of the De Minimis “Loophole”
Starting May 2, 2025, goods from China and Hong Kong that qualify for de minimis treatment (valued at or under $800) will no longer be exempt from tariffs. These goods will now be subject to the full range of applicable duties. This is a key change for companies importing lower-value items from these regions
What This Means for You
- Immediate Action for Importers: All importers should prepare for the 10% baseline tariff on imports starting April 5, and review their sourcing and product lines for potential exposure to the country-specific tariffs that begin on April 9.
- Impact on Canada and Mexico: If you import goods from Canada or Mexico under USMCA, those goods will still be eligible for preferential treatment (0% tariff), provided they qualify as originating goods. Non-USMCA goods from these countries will face 25% duties.
- China Imports: Goods from China valued at or below $800 that would have qualified for de minimis exemption will now be subject to full tariffs starting May 2, requiring importers to plan for the additional duties on smaller shipments.
Uncertainty
Please note that much of this executive action is still evolving, and regulations from U.S. Customs and other agencies are not yet fully implemented. Further updates and clarifications will be issued as the implementation date approaches, and changes may occur. We will continue to monitor developments and keep you informed. There are already exceptions to the information from yesterday and we continue to expect the same will follow.
Sincerely, Your friends at Krenz and Hannan International
SOURCES
The White House Tariff Article – April 2, 2025
The White House National Emergency Tariff Fact Sheet – April 2, 2025
The White House De Minimis Exemption Fact Sheet – April 2, 2025