At a glance

• The main takeaway: Key elements of the United States’ reciprocal tariff program are now in effect, although an ongoing court case challenges the legal bases of some of the tariffs.
• Impact on your business: Businesses, especially express consignment importers and e-commerce retailers, should reassess their logistics, customs declarations, and trade posture.
• Next steps: Aprio can help business owners, executives, and investors determine the impact of the tariff program on their operations and devise strategies to weather the impact.

Schedule a consultation.

The full story on reciprocal tariffs:

The White House has recently finalized key elements of its International Emergency Economic Powers (IEEPA)-based reciprocal tariff program. Country negotiations are largely complete, and new tariff rates are now effective for covered countries under the IEEPA authority. The tariffs package marks a shift in U.S. economic policy, and it is important for businesses to understand the impact on their operations.

In April 2025, President Trump imposed a baseline tariff of 10% on all imports from most countries, with some tariffs higher for certain countries. Country-specific tariffs were then paused until August 1 (with an extension until August 12 for China), during which time the U.S. conducted negotiations around new trade agreements and subsequently issued new reciprocal tariff rates that are now in effect.

New rates now effective on reciprocal tariffs

The Trump administration has announced the following deals reflecting new reciprocal tariff rates:

• EU: Up to 15%
• Japan: 15%
• Philippines: 19%
• Indonesia: 19%
• UK: 10%

For most countries with which the U.S. claims a trade deficit, a 15% rate will be in effect.

While many countries have completed negotiations, some jurisdictions are still in discussions with the U.S. government. For example, negotiations with China, Canada, and Mexico are ongoing. Countries that have not made new trade deals are under the following tariff rates, as of August 1:

• Canada: 35%
• Mexico: 30%
• South Korea: 15%
• South Africa: 30%
• Kazakhstan: 25%
• Laos: 40%
• Malaysia: 25%
• Myanmar: 40%
• Tunisia: 25%
• Bosnia and Herzegovina: 30%
• Bangladesh: 35% 
• Serbia: 35%
• Cambodia: 36%
• Thailand: 36%
• Libya: 30%
• Iraq: 30%
• Algeria: 30%
• Moldova: 25%
• Brunei: 25%
• Sri Lanka: 30%
• Brazil: 50% 

China is reported to be in trade negotiations, and the 35% rate currently in effect is set to expire on August 12. If a trade deal is not reached before that date, the duty rate on China will revert back to the previously imposed rate of up to 125%. 

Further updates to the tariff lists and rates are likely as negotiations proceed, and additional countries may be added depending on risk assessment and Customs and Border Protection (CBP) enforcement focus.

Companies should monitor for changes, particularly if they are sourcing from or selling to countries with pending agreements.

Businesses should also remember that an ongoing court case is challenging the legal basis of some of these tariffs. The Court of International Trade (CIT) in Manhattan blocked some of the tariffs, concluding that the President’s use of the IEEPA to impose the tariffs was unlawful. The U.S. Court of Appeals granted an extended stay, allowing the tariffs to continue while the litigation carries on. What’s certain is that companies should continue to pay tariffs amidst the court challenge.

Tariff stacking and reciprocal tariffs

While tariff stacking refers to the cumulative effect of multiple tariffs applied to a single imported product, companies should be aware that Section 232 tariffs generally do not “stack” with other tariffs. However, reciprocal tariffs imposed under IEEPA do stack with the following:

• MFN HTSUS duties
• Antidumping/Countervailing Duties (AD/CVD)
• Section 301 tariffs
• Other IEEPA tariffs (e.g., fentanyl-related tariffs)

How reciprocal tariffs impact the transshipment tariff

When the updated reciprocal tariffs went into effect at 12:01 AM EDT on August 7, transshipment was affected. Transshipment is the process of transferring cargo from one vessel to another at an intermediate port before it reaches its final destination. U.S. Customs is expected to increase enforcement on transshipment schemes and mis-declared country-of-origin claims, particularly for goods routed through intermediary countries attempting to circumvent higher tariffs. Importers should review their supply chains for any potential exposure and ensure that substantial transformation and origin declarations are well-documented.

An in-transit exemption applied for any goods that were confirmed loaded onto a vessel prior to 12:01 AM EDT on August 7. The in-transit exemption motivated companies to closely examine the timing of loading and achieve the most beneficial logistical timing based on the location of their goods and shipping.

Companies should also be aware of a non-mitigatable 40% penalty on transshipments that result in a loss of revenue due to incorrect origin claims. While companies may be able to challenge origin claim rulings, the amount of the penalty cannot be challenged.

Transshipments don’t typically affect the origin of the goods being shipped, but businesses that are concerned about potential impacts should contact an experienced Customs and Tariffs advisor sooner rather than later to assess that particular supply chain component and other potential consequences of the new rules. Additionally, businesses should rely on the experience of an advisor to help calculate and apply a shipment base duty.

New de minimis duty calculations

As of August 7, the de minimis loophole on goods from every country besides China has ended. The loophole on goods from China and Hong Kong closed in July 2025. De minimis refers to a threshold value set by different countries, below which imported goods are exempt from customs duties and taxes. De minimis simplifies logistics and lowers costs for businesses. The de minimis provision was established in the 1930s to allow small personal shipments to enter the U.S. without tariffs, saving customs agencies the cost of collecting very small duties. However, the so-called “de minimis loophole” has allowed some companies to bypass traditional tariffs.

With the administration’s recent regulations going into effect, the full base duty rate plus the reciprocal tariffs will be collectible at the time of importation on all shipments, regardless of value, even those previously exempt if they were valued at less than $800. The transshipment penalty mentioned above also applies to the de minimis shipments. Additionally, because de minimis shipments have been an avenue of abuse for origin claims, companies may expect extra customs scrutiny around de minimis calculations.

India IEEPA Tariffs

On August 6, 2025, President Trump issued an Executive Order imposing a new 25% tariff on Indian-origin goods under the IEEPA in response to India’s continued importation of Russian oil. Effective August 27, 2025, affected goods will be subject to this tariff in addition to existing duties (MFN, AD/CVD, Section 201, and the prior 25% reciprocal IEEPA duty). Exemptions apply to goods in transit before the effective date and entered by September 17, 2025; Section 232 products; goods listed in Annex II of Executive Order 14257; and those excluded under 50 U.S.C. § 1702(b) (e.g., personal use, humanitarian aid).

Brazil IEEPA Tariffs

On July 30, 2025, President Trump issued an Executive Order imposing an additional 40% tariff on imports from Brazil under IEEPA, citing human rights concerns and coercive actions targeting U.S. companies. Combined with the existing 10% IEEPA reciprocal tariff, the total tariff on Brazilian goods now stands at 50%. The new tariff applies to goods entered or withdrawn for consumption on or after August 6, 2025, with exemptions for products listed in Annex I of the EO, Section 232 goods, those in transit before the effective date and entered by October 5, 2025, and items excluded under 50 U.S.C. § 1702(b).

The bottom line on reciprocal tariffs

With changes to tariffs and the resulting calculation implications, it is a good idea to review your company’s international trade posture with a trusted advisor who has the pulse on the most recent updates. Doing so can help you uncover opportunities to improve your current exposure, reduce costs, boost your business, and even claim refunds. Schedule a consultation today with Aprio’s Customs and Tariffs Services.

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