President Trump issued a proclamation Feb. 20 imposing a global 10 percent tariff under Section 122 of the Trade Act of 1974. Furthermore, on Feb. 21 the president said on social media that he would raise that tariff rate to 15 percent (which is the maximum rate allowed by the statute), although no action to effectuate that change had been taken as of press time.
The new tariff will be effective with respect to goods entered, or withdrawn from warehouse, for consumption on or after 12:01 a.m. EST on Feb. 24, and is slated to be in place through 12:01 a.m. EDT on July 24.
Section 122 allows the president to impose a temporary import surcharge of up to 15 percent ad valorem, temporary quotas, or both, on imported merchandise for balance-of-payment reasons. Specifically, imports may be restricted to (1) deal with large and serious U.S. BOP deficits; (2) prevent an imminent and significant depreciation of the dollar in foreign exchange markets; or (3) cooperate with other countries in correcting an international BOP disequilibrium. Measures may be imposed for a period of up to 150 days, unless extended by an act of Congress.
The presidential proclamation excludes a range of products from the new Section 122 tariff, as detailed in Annex I and Annex II thereof, including (a) certain critical minerals; (b) metals used in currency and bullion; (c) energy and energy products; (d) natural resources and fertilizers that cannot be grown, mined, or otherwise produced in the U.S., or grown, mined, or otherwise produced in sufficient quantities to meet domestic demand; (e) certain agricultural products, including beef, tomatoes, and oranges; (f) pharmaceuticals and pharmaceutical ingredients; (g) certain electronics; (h) passenger vehicles, certain light trucks, certain medium- and heavy-duty vehicles, and buses, as well as certain parts thereof; (i) certain aerospace products; and (j) information materials, donations, and accompanied baggage. Also excluded are articles entered under most HTSUS Chapter 98 provisions, as well as goods entered duty-free under USMCA and textile and apparel goods entered duty-free under CAFTA-DR.
Furthermore, goods subject to Section 232 tariffs will continue to face those tariffs in lieu of the Section 122 tariff, with the caveat that, to the extent a tariff imposed under Section 232 applies to part of an import, the new Section 122 tariff will apply to the part of the import to which Section 232 tariffs do not apply but will not apply to the part of the import to which Section 232 tariffs do apply.
Meanwhile, U.S. Customs and Border Protection issued a CSMS Feb. 22 advising the trade community that duties imposed pursuant to IEEPA will no longer be in effect and will no longer be collected for goods entered, or withdrawn from warehouse, for consumption on or after 12:00 a.m. EST on Feb. 24. CBP will update the Automated Commercial Environment programming and all HTSUS numbers applicable to the IEEPA tariffs will be inactive in ACE as of Feb. 24.
Copyright © 2026 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.