On February 20, 2026, the Supreme Court struck down the IEEPA-based reciprocal tariffs the previous administration had stacked on top of nearly every Chinese-origin import. Refund inquiries flooded into customs brokers within hours. By the next morning, half of those inquiries were asking the wrong question.
The IEEPA ruling did not touch Section 301. The two regimes share a country (China) and a stacking habit, but they live under entirely different statutory authority. Section 301 was upheld by the Federal Circuit on September 25, 2025, in a unanimous decision affirming Lists 3 and 4A. It was not part of the IEEPA litigation. It is not subject to a refund process. And as of this writing, the rates set in the September 2024 four-year review — including the new 50% rate on semiconductors and the 100% rate on Chinese EVs — are fully in force.
If you import from China, this is the year to stop treating Section 301 as a temporary surcharge and start treating it as the baseline. This piece walks through what's actually in effect in 2026, the HTS layers most teams forget, and how the duty stack now interacts after the Supreme Court ruling and the November 1, 2025 Trump–Xi agreement.
The state of play, in three sentences
Section 301 tariffs on Chinese imports remain in full effect at rates from 7.5% to 100%, unchanged in their core structure since 2018 but materially expanded by the 2024 four-year review. The November 1, 2025 Trump–Xi summit extended 178 active product-specific exclusions through November 10, 2026, but did not reopen the exclusion request process — meaning if your product wasn't already on the list, you don't have a path to one. The IEEPA Supreme Court decision removed one tariff layer from the stack but did nothing to reduce Section 301, Section 232, or AD/CVD exposure.
That's the headline. The operational details are where the money is.
A timeline that matters more than the news cycle
The dates below are the ones that determine whether a particular HTS line carries a particular rate on a particular entry. They are also the dates a CBP auditor will check first if you're ever asked to substantiate a planning estimate.
June–September 2018. Lists 1 and 2 take effect. 25% tariffs on roughly $50B of industrial machinery, robotics, and electronics components. These have not changed since.
September 2018 → May 2019. List 3 begins at 10%, raised to 25% in May 2019. Covers about $200B of intermediate and consumer goods. This is where most furniture, lighting, household electronics, and miscellaneous components live.
September 2019 → February 2020. List 4A takes effect at 15%, then drops to 7.5% under the Phase One agreement. Covers $120B of apparel, footwear, and consumer staples. List 4B was scheduled but never activated — it remains formally suspended, which is why phones, laptops, and toys are not directly subject to Section 301.
September 2024. Biden-era four-year review finalizes targeted increases on strategic categories. Electric vehicles to 100%. Lithium-ion EV batteries and battery parts to 25%. Solar cells and polysilicon wafers to 50%. Ship-to-shore cranes, syringes and needles, and certain critical minerals all see new or expanded rates.
January 1, 2025. Semiconductors in HTS headings 8541 and 8542 move from 25% to 50%. This is the rate change that quietly hit the most planning models, because it touches consumer products that contain Chinese-origin chips.
Early 2025 (April). IEEPA-based reciprocal tariffs layer on top of existing Section 301 duties. The combined US duty load on average Chinese imports briefly exceeds 50%, then fluctuates as IEEPA rates shift through the year.
September 25, 2025. Federal Circuit affirms Lists 3 and 4A. No refund pathway for the underlying tariffs. The legal challenge that had been pending for over 6,000 plaintiffs across approximately 3,500 lawsuits is effectively over.
November 1, 2025. Trump–Xi summit produces a US–China trade agreement. 178 product-specific exclusions extended through November 10, 2026. Exclusion request portal not reopened. IEEPA-related fentanyl tariffs on China reduced from 20% to 10%.
February 20, 2026. Supreme Court rules IEEPA tariffs unlawful. Section 301 not at issue, not affected, not subject to refund.
That's six and a half years of stacking, modification, litigation, and recalibration. The number on your CBP form 7501 is the net of all of it.
The layers in 2026, by the numbers
Strip out the politics and what's left is a duty stack that any importer of Chinese-origin goods needs to be able to model:
The current China duty stack on a typical entry
- MFN base rate — the standard HTSUS rate, varies 0–37.5% depending on classification
- Section 301 — 7.5% (List 4A), 25% (Lists 1–3), or 25–100% (post-2024 review categories)
- Section 232 — applies to specified steel, aluminum, copper, and automotive products; stacks subject to the April 29, 2025 anti-stacking executive order
- AD/CVD — case-specific, producer-specific, rates from 0% to 400%+, stacks on top of all of the above
- MPF and HMF — Merchandise Processing Fee (0.3464%, min $32.71 / max $634.62 in 2026) and Harbor Maintenance Fee (0.125% on ocean cargo)
The arithmetic is unforgiving. A $100,000 shipment of HTS 8541 LED-related semiconductors, China origin, no exclusion: $0 MFN base + $50,000 Section 301 (50% under the post-2024 rate) + ~$346 MPF + ~$125 HMF = a $50,471 duty bill before any AD/CVD analysis. The same shipment two years ago, before the four-year review increase, would have been about $25,471. That's the line item that quietly killed product roadmaps across consumer electronics in 2025.
The exclusion question almost everyone gets wrong
There are 178 active Section 301 exclusions in 2026. Most importers, including ones who have been importing for years, can't tell you whether one of them covers their product without checking. The default assumption — "if my product was excluded once, it's still excluded now" — is wrong often enough that we treat it as a red flag.
The mechanics: Section 301 exclusions are claimed using HTSUS Chapter 99 secondary codes (the 9903.88.xx series). On your entry summary, the exclusion has to be declared with the specific 9903 line. If you declare just the primary HTS classification without the 9903 code, CBP charges the full Section 301 rate. We have seen importers leave six figures on the table by failing to flag an active exclusion at entry.
The 178 active exclusions break down as 164 product-specific exclusions plus 14 covering solar manufacturing equipment. They expire November 10, 2026 unless renewed by a future agreement. The exclusion request portal is closed — there is currently no path to obtain a new product-specific exclusion. If your product isn't on the list, your options are classification review (is there a defensible alternative HTS line?), country-of-origin review (is the substantial transformation actually happening in China?), or first sale valuation (which we'll come back to).
The question to bring to your broker before the next entry: "Pull the active 9903.88.xx exclusions for my HTS line and confirm whether we're claiming the exclusion or not. If we're not, why not." That conversation, taken seriously once a year, is worth more than most tariff engineering projects.
Strategy 1: Classification review (the highest-ROI move most importers skip)
Classification isn't a single right answer. It's the application of the General Rules of Interpretation, the chapter notes, and the Explanatory Notes to a specific product. Reasonable people — and CBP itself, in different rulings — sometimes reach different defensible classifications for similar products.
A worked example. CBP ruling N219388 addressed three styles of men's knit garments. Styles PPK 42106 and PPK 52073 — flat screen-printed t-shirts — landed in HTS 6109.10.0012 at 16.5% MFN. Style PPK 63814, structurally similar but built from "slub jersey" fabric, was held to be a "conspicuous non-T-shirt feature" and got pushed to HTS 6110.20.2069 at the same MFN rate. Both classifications are within Chapter 61. Neither is "wrong." But layered on top of Section 301 — both fall within List 3 or List 4A coverage depending on the exact 10-digit suffix — small classification differences move the duty stack measurably.
The lesson is not "find a creative classification." It is "the defensible classification is sometimes not the one your supplier or your old spreadsheet has been using." A serious classification review, done with a licensed broker against current CROSS rulings, is the single highest-ROI compliance project most small importers can do.
Strategy 2: First sale valuation
Section 301 stacks on transaction value. If you can lower the transaction value, you lower every percentage layer above it.
The First Sale rule, formally adopted in T.D. 96-87 and grounded in the Federal Circuit's 1992 decision in Nissho Iwai American Corp. v. United States, allows duties to be paid on the price the foreign manufacturer charged the foreign middleman, rather than the (higher) price the middleman charged the US importer. For multi-tiered transactions where the middleman markup is substantial — common in electronics, apparel, and consumer goods sourced from Asia — first sale can reduce the dutiable value by 15–30% or more.
The conditions are strict. CBP ruling H327067 is the cautionary tale: the agency disallowed a first sale claim because the middleman didn't take title or assume risk of loss. The transaction's Incoterms gave it away. CBP's enforcement of first sale has tightened materially in 2024 and 2025; importers using or considering the structure in 2026 should expect verification requests, and the documentation requirements (contracts, purchase orders, invoices, bills of lading, proof of payment, transfer pricing studies) are non-trivial.
First sale isn't a hack. It's a legitimate valuation method that has been on the books for thirty years. But it requires real commercial substance at the middleman tier. If your "middleman" is a paper entity that never holds title, first sale isn't available, and trying to claim it is the kind of thing that ends in a False Claims Act case.
Strategy 3: Origin diversification (and the trap to avoid)
The Ceratizit USA settlement in December 2025 — $54.4M to settle DOJ allegations of misrepresenting Chinese-origin tungsten carbide as Taiwanese — drew a hard line that some importers had been drifting toward for years. Origin engineering is legitimate. Origin misrepresentation is not.
Legitimate diversification means actually moving production, or actually achieving substantial transformation under 19 C.F.R. § 102.21 (textiles and apparel) or the case law for other products. "Substantial transformation" is a fact-intensive test — the foreign processing has to result in a new and different article of commerce, with a new name, character, or use. Putting a Chinese-made widget in a Vietnamese box does not qualify. Cutting and sewing a finished garment in Cambodia from Chinese fabric might qualify, depending on the chapter rules.
Before you commit capex to a Vietnam, Mexico, or Thailand supplier, get a binding ruling. CBP issues origin rulings on request, and a binding ruling is the difference between a defensible diversification strategy and a False Claims Act exposure.
What we expect over the next 12 months
Three things are worth watching, in order:
The November 10, 2026 exclusion expiration. Whether the exclusions get extended again, get expanded, or expire entirely is a major variable for the importers currently relying on them. Plan for expiration. Treat any extension as upside.
The next four-year review. Section 301 carries a statutory four-year review requirement. The next one is on the calendar. Strategic categories — biotech, advanced batteries, drones, robotics — are all candidates for new or higher rates. If you import in any of these categories, model a 25% Section 301 layer even where one doesn't currently apply.
Section 232 and the post-IEEPA settlement. With IEEPA off the table, the administration has incentives to expand Section 232 (steel, aluminum, copper, autos) and possibly Section 122 (a separate global tariff authority) into categories that were previously covered by IEEPA. The duty stack architecture will keep shifting even if Section 301 itself stays still.
If you import from China and you don't currently have a current source-backed Section 301 review for every active SKU, that's the project to do this quarter. Use the free landed-cost calculator to model the stack under current rates and the HS / HTS lookup to capture the source URLs and retrieval dates for each layer. The exclusion deadline is closer than it looks.
Planning guide. Not legal advice. Tariff classification, valuation, and origin determinations are fact-specific. For binding determinations on classification or origin, request a CBP ruling. For AD/CVD, first sale, or False Claims Act exposure questions, consult licensed trade counsel.
