Navigating US tariffs
Trade Regulatory Digest
Continuing access to the US market despite tariffs and importer controls
Tariff principles
The latest US Section 301 tariff measures have added another layer of complexity for businesses exporting into the US. For many companies, the challenge is no longer identifying a single tariff rate but working out the total duty cost of getting goods into the US.
At the same time, the US is moving towards tighter customs enforcement and greater scrutiny of importers. Against this backdrop, exporters should reassess both their tariff exposure and their US import arrangements. This digest outlines the key tariff considerations and customs developments that businesses should be monitoring.
Many APAC exporters continue to face uncertainty in determining total tariff costs when their goods are imported into the US. This is not surprising given the proliferation of US tariff actions, changing product exemptions, and the different legal mechanisms used to apply them.
Businesses should first confirm whether their products are eligible for certain broad-based tariff exemptions (for example, certain products for people with disabilities). If not, they should then determine the baseline applicable tariff rate, be that the general (so-called most-favoured nation or MFN) rate or a preferential tariff under a Free Trade Agreement (FTA). Subsequently, they need to assess whether an additional “broad-based tariff” (such as the Section 301 forced labour tariff) or sector-specific tariffs apply. Finally, they should consider whether additional measures, such as China-specific Section 301 tariffs, anti-dumping duties or countervailing duties, apply.
In short, the total applicable tariff should be viewed as a layered calculation rather than a single rate. As applicable tariffs vary depending on product classification, country of origin, applicable exemptions, and trade remedies, exporters should validate all these aspects before they are able to confirm total duty exposure.
Why technology-enabled tariff scenario planning is becoming more important
Technology can help you plan for multiple tariff outcomes across products, suppliers, origins, importers, and customers in a short span of time, so that you can:
- Compare overlapping duties and tariff scenarios.
- Test mitigation options more quickly and consistently.
It is our experience that many scenarios, even those that are based on very different assumptions, lead to, or at least include, very similar business response actions.
Hence, scenario planning gives you the time and confidence to make informed decisions, protect revenue, manage cost impacts, re-route trade flows, and explore alternative suppliers or markets. It also creates the runway to strengthen your US importer capabilities in line with tighter enforcement and documentation requirements.
Tariff calculation
1. Baseline tariff
The tariffs previously paid on imports into the US continue to apply. These may be the Most-Favoured-Nation (MFN) tariff or a preferential tariff under a Free Trade Agreement (FTA).
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2a. Sector-specific tariffs
Certain products imported into the US may instead be subject to sector-specific tariffs under Section 232, e.g.
- A narrow set of semiconductors and products containing those semiconductors based on their technical parameters and intended use
- Patented pharmaceuticals and related ingredients, with rates varying based on product type, country of origin, and company‑specific onshoring and pricing commitments
Or
2b. New Section 301 forced labour tariff on imports from 60 economies, subject to product exemptions
Affected trading partners and rate rules
Flat 10% rate: Applies to Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, the United Kingdom, and Trinidad and Tobago.
Top-up rules: For the European Union, Taiwan, Japan, Korea and Switzerland, the Section 301 duty is calculated by reference to the applicable MFN/FTA rate, rather than as a flat additional rate.
- 10% top-up: For the European Union and Taiwan, the combined MFN/FTA and Section 301 rate generally tops up to 10% where the MFN/FTA rate is below 10%; if the MFN rate is already 10% or higher, the Section 301 duty is zero.
- 12.5% top-up: For Japan, Korea and Switzerland, the combined MFN/FTA and Section 301 rate generally tops up to 12.5% where the MFN/FTA rate is below 12.5%; if the MFN/FTA rate is already 12.5% or higher, the Section 301 duty is zero.
Where preferential FTA treatment is available, such as under the US-Korea FTA, interaction with the top-up rule should be confirmed against implementing guidance.
Flat 12.5% rate: Applies to goods of all other investigated economies, subject to any product exemptions or later implementing guidance: Algeria; Angola; Australia; the Bahamas; Bahrain; Brazil; Chile; China; Colombia; Costa Rica; Dominican Republic; Egypt; Guyana; Hong Kong SAR ; Iraq; Israel; Kazakhstan; Kuwait; Libya; Morocco; New Zealand; Nicaragua; Nigeria; Norway; Oman; Peru; the Philippines; Qatar; Russia; Saudi Arabia; Singapore; South Africa; Thailand; Türkiye; United Arab Emirates; Uruguay; Venezuela; and Vietnam.
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3. Other tariffs that may apply
- China-specific tariffs under Section 301
- Anti-dumping duties (ADD) or countervailing duties (CVD)
Total = 1 + 2a or 2b + 3, if applicable
Unknown tariffs
Tariff implications remain uncertain for Section 301 investigations into structural excess capacity and production in the manufacturing sectors of 16 economies, namely Bangladesh, Cambodia, China, the European Union (EU), India, Indonesia, Japan, Malaysia, Mexico, Norway, Singapore, South Korea, Switzerland, Taiwan, Thailand, and Vietnam.
Importing into the US
Executive Order on Strengthening Customs Enforcement
Issued: 3 June 2026
Implementation window: Key measures are expected to be implemented within 45 to 180 days through regulations, guidance or policy revisions.
Executive Order 14411 (EO) moves US customs enforcement from a largely transactional tariff-collection model to a broader framework focused on importer accountability, supply chain transparency and revenue protection.
Key areas of change include:
- Importer eligibility: Tighter rules and good-standing checks for US importers.
- Financial assurance: Higher bond requirements and, potentially, US asset requirements to safeguard against duty and compliance risk.
- Expanded disclosures: More information on importer ownership, affiliations, import volumes and domestic assets.
- Supply chain reporting: Greater visibility into production, sourcing, product composition and supply chain participants.
- Heightened restrictions on foreign importers of record: Informal entry procedures eliminated; continuous bonds restricted or unavailable.
A key change is the distinction between a “US importer of record” and a “foreign importer of record” (IOR). A foreign IOR is any entity that does not qualify as a US IOR.
To qualify as a US IOR, an entity must be organised under US law, located in the United States and either have controlling beneficial owners who are US citizens or lawful permanent residents at all times, or own significant US real property.
Subject to further guidance, being “located in the United States” requires, at a minimum:
- a principal place of business in the United States;
- a physical US presence where significant business activity is conducted; and
- sufficient US tangible assets, assessed against the size and scale of the company’s operations and whether the entity is effectively acting for a foreign manufacturer without substantial US presence.
The companies most exposed may be importers that outsourced the IOR function years ago through a service provider or foreign logistics intermediary and have not reviewed the arrangement since.
If that provider is treated as a foreign IOR, imports will generally require formal entries, with higher administrative costs, brokerage fees, and landed costs. The foreign IOR may also face continuous-bond restrictions and must be Customs Trade Partnership Against Terrorism (CTPAT)-validated or use a CTPAT-validated, licensed customs broker to file entries.
Shipments that previously cleared smoothly may therefore be delayed or blocked once the rules take effect. The “good-standing” requirement also makes the IOR group’s compliance history directly relevant to clearance risk, including past customs violations, unpaid liabilities or enforcement actions.
PwC point of view How APAC exporters could respond
Exporters around Asia should move beyond one-off tariff estimates and build a broader risk-based response that addresses tariff exposure, importer status, supply chain evidence and clearance risk.
Immediate term:
- Monitor product-specific exemptions and exclusions to capture available duty savings.
- Quantify exposure by tariff scenario, product, entity and customer to identify the highest-risk lanes and SKUs, and to inform pricing, sourcing, inventory and contract decisions.
- Confirm who acts as IOR and whether it qualifies as a US or foreign IOR to assess continuity of US imports, formal-entry requirements, bond constraints and CTPAT dependencies.
- Review the IOR group’s compliance history, including past customs violations, unpaid liabilities and enforcement actions, to identify potential good-standing and clearance risks.
- Identify national laws and internal restrictions on sharing information with foreign governments to determine what can be disclosed, who must approve it, and whether alternative evidence is required.
Medium term:
- Strengthen customs data and supply chain visibility across classification, origin, valuation, suppliers, key products and critical components to withstand increased Customs and Border Protection (CBP) scrutiny, and guide trade compliance investment.
- Review the longer-term US import operating model to decide whether import responsibility, entity structure, funding, bond capacity, CTPAT arrangements, and supplier data collection should be centralised, localised or redesigned.
- Align customs valuation and transfer pricing positions, as expanded disclosure and supply chain reporting may give CBP greater visibility into intercompany arrangements between foreign entities and their US affiliates.
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