New Tariff Rates for Canada, Mexico and China

President Trump signing an executive order

The Trump administration has set new tariffs on goods from Canada, Mexico and China to begin on February 4, 2025. What does this mean for importers of products to the US? It's difficult to say since the executive order signed by President Trump is very general. There is some confusion surrounding whether goods which were given special breaks from tariffs under the first Trump administration will be rescinded under this new order and all products will have the new tariff applied. But let's get into the heart of the story...

The new tariff rates are 25% for Canada and Mexico on all products across the board. The new China tariff is an extra 10% in addition to all other ad valorem duties and China tariffs (section 301) that already exist. This means that if you're importing, say, plastic buttons from China valued at less than $.20 per dozen your duty rate would be 3.5 + 25 for section 301 + an additional 10% for the new tariff for a total of 38.5%.

These new tariffs are set to go live on February 4, 2025 and while for Mexico and Canada it's pretty clear cut, what does this mean for people shipping products from China? There is a bit of a grace period which is set for in transit items. Anything which was loaded onto a vessel in a port of lading before 12:01am Eastern US time on February 1, 2025 and which arrives in a port of the US before 12:01am Eastern US time March 7, 2025 will not be subject to the new tariffs. After March 7, anything, no matter when it was loaded or shipped will have the new tariff applied to it. Additionally, the de minimis duty exemption is no longer viable for the new Trump tariff for Chinese goods. Indeed, there are even restrictions on how small items and purchases can come into the and be distributed in the United States. The USPS will no longer be able to distribute items shipped from China and other services such as UPS, Fed Ex or DHL must be used.

This story is quite fluid and we'll keep this article updated with the updates in the rather mercurial process and deadlines for these new tariffs.

UPDATE: The situation appears rather fluid and the Trump administration has granted a 30 day reprieve to Canada and Mexico on their new tariff rates. The idea here is that possibly the tariffs will be rescinded if Canada and Mexico take steps to reduce illegal immigration and fentanyl distribution across the border. It is unclear what an acceptable level of action would be so that imports from Canada and Mexico would be free of the new tariffs.

UPDATE: The cancellation of the de minimis exemption for the Trump tariffs has been put on hold. There is currently no mechanism for proper and accurate enforcement for collection of duties on de minimis items so if you're importing items under $800 you can still claim de minimis and not have to pay the duty rates.

UPDATE: The Trump administration has announced that the 25% tariffs on Canadian and Mexican imports will continue as planned starting as early as March 4. In the announcement, the specific date of March 4 was not mentioned, indeed no date was mentioned, simply the phrase "on time" was used. The general speculation is that the 25% tariff rates for Canada and Mexico will be reinstated as early as March 4, one month from the original date of the new tariff rates.

UPDATE: The Trump administration has changed yet again. While 25% tariffs are set to continue for many products from Canada and Mexico, anything which is covered under the USMCA agreement is exempt form the new tariff for one month. After that time it is unclear whether or not there will be a straight 25% or if these items will fall into the reciprocal bucket which will be announced on April 2 or if something else will happen.

UPDATE: The post is getting quite long with updates and we will create a new April 2 tariff blog entry which will have more information and hopefully some consolidation after the announcement from President Trump.