Import Compliance in 2025: Navigating the U.S. Tariff and Duty Drawback Landscape
U.S. tariffs are shifting fast, affecting costs, compliance, and sourcing. Understanding new rates, stacking rules, and legal changes helps businesses control exposure and protect margins.
Words by
Chen Cui
I attended Adrienne Braumiller’s ICPA session in Grapevine, TX and captured the key U.S. tariff shifts now hitting importers. This post outlines the IEEPA litigation, new Section 232 rates, sector‑specific changes in autos, copper, and wood, and how stacking rules alter the final duty burden. I also list practical mitigation steps for compliance and cost control.
U.S. tariff update: what changed and what it means
IEEPA lawsuit
Status: CIT ruled in May 2025 that IEEPA could not be used to impose tariffs. The Federal Circuit affirmed in August 2025. Supreme Court oral arguments are scheduled for November 2025.
Exposure: If the government loses, importers may recover some paid duties, notably fentanyl‑related and reciprocal tariffs.
Action: Track entries and consider requesting liquidation extensions until final resolution.
Fentanyl and reciprocal tariffs
China: Fentanyl tariff reduced from 20% to 10%, taking the combined rate on Chinese imports from 57% to 47%.
Canada and Mexico: Canada’s fentanyl tariff increased to 35% in August 2025. Mexico remains under negotiation.
Reciprocal tariffs: Increased in several countries. These apply only to the non‑U.S. content in a product, with carve‑outs for certain goods like steel and aluminum.
Section 232 metals
Rates: Steel and aluminum doubled to 50% in March 2025. Derivative products are included.
Traceability: CBP requires “melted and poured” origin tracing for metal content.
Exclusions: Prior product exclusions terminated in March 2025. Refunds may be possible where duties are no longer owed, but outcomes depend on stacking rules.
Automobiles and parts
Rate: 25% effective April 2025, applied to the non‑U.S. content of vehicles and parts.
Relief: USMCA provides relief for qualifying goods; Commerce is still developing the qualification process.
Interim country rates: Japan 15%; UK 10% on the first 100,000 cars each year.
Example: A vehicle with 40% foreign content pays the 25% tariff only on that 40%.
Copper and wood
Copper: 50% on semi‑finished copper effective August 1, 2025. Duty applies to copper content; reciprocal duties may apply to non‑copper components.
Wood: 10% on timber and lumber; 25% on furniture and cabinets. Absent agreements by January 2026, rates rise to 30% on furniture and 50% on wooden cabinets and vanities.
Mitigation playbook
Diversify suppliers and manufacturing locations.
Use FTZs and bonded warehouses to defer duty.
Claim drawback, especially on Section 301 duties.
Qualify under USMCA where possible, notably autos and agriculture.
Use Chapter 98 provisions for eligible exemptions.
Monitor new exclusion processes and petition opportunities.
Tariff stacking: order and effects
Stacking order determines the final duty burden when multiple regimes apply.
Section 232 autos/parts: If applied, other Section 232 metal duties do not apply, and IEEPA I (fentanyl) for Canada or Mexico does not apply.
Section 232 steel/aluminum: If applied, IEEPA I (fentanyl) for Canada or Mexico does not apply, but reciprocal duties may still apply to non‑metal content.
IEEPA I (fentanyl): Drops out when Section 232 metal duties are paid. IEEPA II (reciprocal) can still apply to non‑metal components.
Illustration: Import a steel tank (HTS 7309.00.00) from Canada. Pay 50% Section 232 on the steel content. Canada is exempt from the 10% IEEPA II reciprocal duty. IEEPA I does not apply once Section 232 steel is paid. Other regimes such as MFN, CVD, and AD may still apply.
China trade timeline: 2025 highlights
Apr 2: U.S. sets 34% reciprocal tariff on all Chinese imports, on top of regular duties, Section 301, 20% fentanyl, and Section 232.
Apr 3: China responds with 34%.
Apr 8: U.S. increases to 84%.
Apr 9: China raises to 84%.
Apr 10: Escalation reaches 125%; reciprocal rates for other countries paused.
May 14: 90‑day de‑escalation through August 12.
Jun 11: U.S. announces framework for talks.
Aug 12: Talks extended 90 days.
Oct 9: China announces tighter rare‑earth export controls.
Oct 10: U.S. announces potential 100% tariffs on Chinese goods and export controls on critical software, effective November 1.
Oct 31–Nov 1: Trump and Xi meet at APEC in South Korea.
Country snapshots
China: Fentanyl tariff cut to 10%, yielding a 47% overall rate. Talks continue on rare earths and magnets.
United Kingdom: 10% reciprocal tariffs; 0% on civil aircraft; metals capped at 50%; new openings for U.S. beef after the UK removes 20%.
European Union: 15% reciprocal tariffs; 50% on steel, aluminum, and copper; significant investment commitments in U.S. industries and wider market access.
Japan: 15% reciprocal tariffs on most goods; metals at 50%; large U.S. investment commitments.
India: Deal collapsed in August 2025; 50% reciprocal tariffs in place; talks continue.
Bottom line
The tariff regime is fluid. Watch the IEEPA case, keep proofs of origin and content breakdowns, and model outcomes under stacking rules. Use FTZs, drawback, USMCA, and Chapter 98 to reduce landed cost.
