Update | Trade Advisory: IEEPA Tariffs, Steel & Aluminum Clarifications
UPDATED – March 7, 2025
IEEPA Tariffs
Mexico/Canada
The Federal Register notices implementing the IEEPA 25% tariffs on Mexico and Canada were released.
Effective 12:01 a.m. ET, March 4, tariffs of 25% will be assessed on products of Canada or Mexico entering the U.S.; except for energy products from Canada which will be assessed a 10% duty.
9903.01.10 Canada
9903.01.01 Mexico
Note that the tariffs apply to “products of Mexico/Canada”.
The following products are NOT subject to the additional tariffs:
Products Excluded from Additional Tariff
The additional duty will not apply to:
Goods that are for personal use.
Goods entered under Chapter 98 HTSUS including:
9802.00.40 or 9802.00.50 (repairs/alterations) tariffs apply on value added in Mexico/Canada.
9802.00.60 (metal articles processed abroad) tariffs apply on value added in Mexico/Canada.
9802.00.80 (assembly of US components) tariffs apply on value added in Mexico/Canada.
9801 goods exported from the US and returned from Mexico/Canada not subject (even if Mexico/Canada)
Other Chapter 98 goods are excluded.
Donations of food, clothing and medical intended to relieve human suffering (claim HTSUS 9903.01.02 for the exemption for Canada).
Merely informational materials (claim HTSUS 9903.01.03 for the exemption for Mexico and 9903.01.12 for the exemption for Canada).
Country of Origin is not CA or MX
No drawback is allowed for these tariffs. Duty drawback is allowed for other eligible duties paid.
There is no grace period for goods in transit.
Section 321 de minimis goods are not impacted until such time as Commerce establishes a system to collect the tariffs.
FTZ Goods
Products of Mexico/Canada admitted to an FTZ after 12:01 a.m. ET on March 4 must be admitted in privileged foreign status. Upon entry for consumption into the U.S., they will be subject to the rate of duty in effect at the time of admission into the zone. Goods eligible for admission to an FTZ under domestic status are exempt from the tariffs.
United States-Mexico-Canada Agreement (USMCA)
Effective on or after 12:01 a.m. eastern standard time March 7, 2025, goods that are entered for consumption or withdrawn from warehouse for consumption that qualify for USMCA, are exempt from the additional duty rates that were implemented March 4, 2025, with Harmonized Tariff Schedule of the United States (HTSUS) 9903.01.01.
Articles that are entered free of duty under the terms of general note 11 to the HTSUS, including any treatment set forth in subchapter XXIII of chapter 98 and subchapter XXII of chapter 99 of the HTS, as related to the Agreement between the USMCA, shall not be subject to the additional ad valorem rate of duty described in section 2(a) of Executive Order 14194 & 14193.
Mexico – EO 14194
The following new HTSUS classification applies to products that qualify for USMCA:
9903.01.04: Articles that are entered free of duty under the terms of general note 11 to the HTSUS, including any treatment set forth in subchapter XXIII of chapter 98 and subchapter XXII of chapter 99 of the HTS, as related to the USMCA.
Canada – EO 14193
9903.01.14: Articles that are entered free of duty under the terms of general note 11 to the HTSUS, including any treatment set forth in subchapter XXIII of chapter 98 and subchapter XXII of chapter 99 of the HTS, as related to the USMCA.
So net effect is, we had tariffs for three days on all Mexican and Canadian goods. The exemption is NOT retroactive, thus those goods imported during the 3-day period are stuck, subject to tariffs.
China/Hong Kong
The President amended his prior Executive Order issued on Feb. 1 increasing the tariff from an additional 10% to 20%.
For products of China and Hong Kong entered or withdrawn from warehouse for consumption on or after 12:01 a.m. ET, Feb. 4, through March 3 the additional duty will be 10% and importers should use:
HTS 9903.01.20 (other than products classifiable under 9903.01.21 (donations), 9903.01.22 (informational materials) and 9903.01.23 (grace period until March 7 for goods “loaded onto a vessel/in transit” prior to Feb. 1) and personal use goods.
For products entered or withdrawn from warehouse for consumption, on or after 12:01 a.m. ET on March 4, the additional duty will be 20% and should use:
HTS 9903.01.24 (other than products classifiable under 9903.01.21 (donations), 9903.01.22 (informational materials) and 9903.01.23 (grace period until March 7 for goods “loaded onto a vessel/in transit” prior to February 1) and personal use goods.
However, a grace period for Goods In Transit may allow the goods to be exempted from the tariff until March 7 if:
Claim HTSUS 9903.01.23 for the exemption if Goods loaded on a vessel or in transit on the final mode of transport prior to 12:01 a.m. ET on Feb. 1, 2025, even if they were entered or withdrawn from warehouse for consumption after Feb. 4 will not pay the additional tariffs, but only until 12:01 a.m. ET on March 7. Entry after that date will require payment of the duties.
Exclusions
9903.01.21: Articles the product of China and Hong Kong that are donations, by persons subject to the jurisdiction of the United States, of articles, such as food, clothing, and medicine, intended to be used to relieve human suffering.
9903.01.22: Articles the product of China and Hong Kong that are informational materials, including but not limited to, publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news wire feeds.
Chapter 98 (except for goods entered under 9802.00.80; and subheadings 9802.00.40, 9802.00.50, and 9802.00.60).
9802.00.40, 9802.00.50, and 9802.00.60 – The additional duties apply to the value of repairs, alterations, or processing performed (in China and Hong Kong).
9802.00.80 – The additional duties apply to the value of the article assembled abroad (in China and Hong Kong), less the cost of value of such products of the United States, as described.
Steel/Aluminum
The Federal Register notices on Steel and Aluminum has been published on March 5, 2025. They are available today for review and we have linked them for your reference.
In summary,
Steel
March 12 is the effective date for 25% tariffs on the original steel products and derivatives plus the NEW list of derivative products classified in HTS Chapter 73.
The effective date for 25% tariffs on NEW derivative steel products listed but not classified in HTS Chapter 73 will be determined by the Secretary of Commerce when a system is in place to collect the duties on those products. The additional duty shall only apply to the declared value of the steel content of the derivative article. The quantity of the steel content shall be reported in KG.
All Imports of derivative products shall provide any information that may be required by CBP to permit administration of the duties.
A duty exemption applies ONLY to the NEW list of derivative products provided the product was processed in another country from steel articles that were melted and poured in the U.S. This same exemption does not apply to steel articles and derivatives on the ORIGINAL lists.
Clarification to Turkey Section 232 Steel Tariff
The proclamation refers to the 50% tariff on Turkey under HTS 9903.80.02. However, when you look at the HTSUS, there is no 9903.80.02. NCBFAA Customs Counsel did further research after the mention of 50% in some initial communications, to find that in May 2019, HTSUS 9903.80.02 was deleted. Thus, despite the reference in the President’s document, because that HTS no longer exists, Turkey is only subject to the 25% tariffs. They have corrected this in subsequent updates.
Aluminum
March 12 is the effective date for 25% tariffs on the ORIGINAL aluminum products and derivatives plus the NEW list of derivative products classified in HTS Chapter 76.
The effective date for 25% tariffs on NEW derivative steel products listed but not classified in HTS Chapter 76 will be determined by the Secretary of Commerce when a system is in place to collect the duties on those products. The additional duty shall only apply to the declared value of the aluminum content of the derivative article. The quantity of the aluminum content shall be reported in KG.
Note that importers are required to report to CBP the primary country of smelt, secondary country of smelt, and country of cast on imports of all aluminum articles subject to the aluminum and aluminum derivatives Section 232 measures. In addition, all Imports of derivative products shall provide any information that may be required by CBP to permit administration of the duties.
A duty exemption applies ONLY to the NEW list of derivative products provided the product was processed in another country from aluminum articles that were smelted and cast in the U.S. This same exemption does not apply to aluminum articles and derivatives on the ORIGINAL lists.
If the products are from Russia, or any amount of primary aluminum use to make the article is smelted in Russia or cast in Russia, it is subject to 200% tariffs. In Addition, the same exemptions under HTS Chapter 98 do not apply the same say as the other origin goods.
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