Hello Customers, Colleagues, and Friends…
We are writing to inform you of an important update regarding the IEEPA Reciprocal Tariffs. As of 12:01 a.m. Eastern Time on April 10, 2025, the previously announced country-specific reciprocal tariff rates (above 10%) have been suspended for 90 days, with the exception of imports from China, Hong Kong, and Macau. Below is a breakdown of how this impacts current shipments:
Tariff Updates: What’s Changed
- The Reciprocal Tariff rate reverts to 10% for all countries except China, Hong Kong, and Macau.
- Imports from China, Hong Kong, and Macau are now subject to a 125% additional ad valorem tariff, under HTSUS 9903.01.63, unless specifically excluded (see below).
All other previously announced tariffs—including Section 301, Section 232, and the 10% IEEPA Baseline Tariff—remain in effect.
Exemptions
The following shipments are excluded from the new 125% tariff and/or the 10% Reciprocal Tariff:
- USMCA-qualified goods from Canada and Mexico remain exempt.
- In-Transit Exemption: Goods loaded on their final mode of transport before 12:01 a.m. EDT on April 5 and entered on or after that time may be exempt through May 26, 2025.
- Goods from General Note 3(b) Column 2 countries (e.g., Belarus, Cuba, North Korea, Russia).
- Donations intended to relieve human suffering (e.g., food, clothing, medicine).
- Informational materials such as books, films, recordings, and news feeds.
- Goods explicitly excluded in Annex II of the Executive Order.
- Steel, aluminum, and derivative products already covered under Section 232.
- Passenger vehicles, light trucks, and automotive parts subject to Section 232 tariffs.
- Goods in which 20% or more of the value is U.S.-origin will only be subject to the reciprocal tariff on the non-U.S. content. Documentation will be needed to validate the U.S.-origin portion.
Foreign Trade Zones (FTZ) & Drawback
Drawback is permitted for duties paid under this tariff structure. For FTZs: Goods entered on or after April 5, 2025, must be admitted under Privileged Foreign Status (19 CFR 146.41). These goods will be subject to the applicable tariff in effect at the time of FTZ admission, not at time of withdrawal.
What this means for you
- Review your supply chain and HTS classifications immediately.
- Coordinate with your suppliers on U.S.-origin content to determine eligibility for partial exemption,if applicable
- Stay tuned for the next round of changes.
We understand these rapid shifts create challenges and uncertainty. Our team is here to help you navigate this evolving environment. Please don’t hesitate to reach out with questions or for clarification on how these changes may affect your business.
Sincerely, Your friends at Krenz & Hannan International