Section 301 Tariffs
on China, 2026 Breakdown

Section 301 of the Trade Act of 1974 gave the US Trade Representative the authority to impose tariffs on countries engaged in "unfair trade practices." In 2018, the Trump administration used that authority to impose additional duties on Chinese imports. The structure was extended by the Biden administration and expanded again in 2024.

This is the 2026 picture of what Section 301 actually costs you, and what you can do about it.

The four original lists

List	Effective	Tariff Rate	Approximate Coverage
List 1	July 2018	25%	$34B of industrial machinery, electronics components
List 2	August 2018	25%	$16B of plastics, chemicals, semiconductors
List 3	September 2018 (raised May 2019)	25%	$200B of consumer goods, furniture, textiles
List 4A	September 2019	7.5%	$120B of apparel, electronics, footwear
List 4B	Suspended	n/a	$160B that was suspended pending Phase One

The 2024 strategic expansion

In May 2024, the Biden administration announced significant tariff increases on strategic categories where China subsidizes production. Most rates took effect in 2024 and 2025:

Category	Old Rate	New Rate
Electric vehicles	25%	100%
EV batteries (lithium-ion)	7.5%	25%
Semiconductors (legacy nodes)	25%	50%
Solar cells	25%	50%
Steel and aluminum (specific HTS)	0-7.5%	25%
Medical syringes and needles	0%	50%
PPE (gloves, masks)	0-7.5%	25%
Permanent magnets	0%	25%
Ship-to-shore cranes	0%	25%

How Section 301 stacks with base duties

Section 301 is applied on top of base HTS duties. A product with a 5% base rate on List 3 pays 5% + 25% = 30% total ad valorem duty.

For the full landed cost math including MPF and HMF, see our import duties from China to USA guide.

The exclusion process

Some HTS codes have product-specific exclusions from Section 301. The USTR has periodically opened comment windows where importers can request exclusions, typically based on:

• The product is not available outside China
• The tariff would cause "severe economic harm" to the requester
• The product is not strategically important to China's Made in China 2025 initiative

Granted exclusions are typically time-limited (1 to 2 years) and can be extended. The 2024 round granted relatively few exclusions; most original 2018-2020 exclusions have expired or were not renewed.

Check the current exclusion list before placing orders. CBP applies exclusions retroactively if you have not already paid the duty.

Where the tariff is actually paid

The myth: tariffs are paid by the foreign exporter. The reality: tariffs are paid by the US Importer of Record (typically the US buyer) when the goods enter US commerce. The cost is then passed up the supply chain depending on contract terms and pricing power.

Under FOB, the buyer pays the tariff and sees it directly. Under DDP, the seller is supposed to pay (and bundles it into the unit price), but in practice the buyer is often still the legal Importer of Record and on the hook if duty changes after entry.

Origin shifting strategies

Section 301 applies only to goods of Chinese origin. The most common workaround is shifting manufacturing to other countries:

• Vietnam: largest beneficiary of China origin shifts. Apparel, electronics, furniture all moved meaningfully.
• Mexico: nearshoring under USMCA (some categories get duty-free treatment).
• Thailand and Malaysia: semiconductors and electronics.
• India: textiles, pharmaceuticals, some electronics.
• Indonesia and Cambodia: apparel and footwear.

Origin must be the result of "substantial transformation." Simple repackaging or relabeling in Vietnam does not change the Chinese origin. CBP enforces this aggressively through its customs hold and exam process.

The single biggest mistake importers make is assuming "shipped from Vietnam" equals "Vietnamese origin." Origin is about where the goods were substantially transformed, which is a specific legal test. Get it wrong and CBP will reclassify, demand back duties, and assess penalties.

What "substantial transformation" actually requires

The legal test is whether the manufacturing process in the new country results in a product with "a name, character, or use different from that of the imported components." Simple processes that do NOT count:

• Packaging
• Labeling
• Assembly of pre-made components if the process is "minimal"
• Sorting, cleaning, or repacking

Processes that DO count:

• Real manufacturing or fabrication
• Assembly of components into a more complex product where the assembly is non-trivial
• Chemical transformation

Section 232 vs Section 301

Section 232 (national security) is a separate tariff authority. It applies primarily to steel and aluminum and is country-agnostic in scope. Some Chinese steel and aluminum products pay both Section 232 (25% on steel, 10% on aluminum) and Section 301 (25% additional). Stacking gets ugly fast.

What to do about it

1. Calculate your real landed cost including Section 301. Many importers still model deals on base HTS only and get blindsided.
2. Check the exclusion list for your HTS codes. A handful of exclusions remain active.
3. Reclassify defensible HTS codes. Some products fit multiple HTS codes legitimately, with different Section 301 treatment.
4. Evaluate origin shifts. For categories with 50%+ Section 301 (semiconductors, batteries, EVs, solar), origin shifting often pays for itself in one year.
5. Document substantial transformation thoroughly. If you claim Vietnam or Mexico origin, have the manufacturing records to defend it.
6. Watch the announcement cycle. USTR can adjust rates and lists. The 2024 expansion was previewed months in advance; many importers had time to adjust if they were watching.

Bottom line

Section 301 is the dominant variable in landed cost for Chinese imports. For most consumer goods, expect 25% to 35% total duty after stacking. For strategic categories under the 2024 expansion, expect 50% to 100%+. The exclusion process is narrow and slow. The realistic levers are accurate HTS classification, origin shifts where the math works, and pricing power negotiations with US customers.

Further reading

• Import duties from China to USA: full breakdown
• China sourcing guide: factories, QC, and origin diversification
• FOB vs DDP: who pays the duty
• Customs holds and CBP exams