New China Tariffs to be Published

The new tariff on goods from China is being published on Wednesday, February 12, 2025. The way that they are drafted my impose a greater-than-expected customs duty on some products from China.

When you report tariff codes, you will report the 10-digit code that applies to the goods being imported, as well as the chapter 99 code that describes the additional tariff.

The new tariff code that applies to aircraft parts is 9903.01.20. The duty associated with this code is “The duty provided in the applicable subheading + 10%.” This is a fairly normal nomenclature for a category 99 tariff – it means you take the normal duty associated with the main subheading and add 10%; but it typically assumes that there is only one chapter 99 tariff that applies to your import.

For example, aircraft parts under heading 8807 are imported for zero duty, so the new duty when importing from China is zero + 10% or 10%. Steel lock washers imported under heading 7318 are subject to 5.8% duty, so if steel lock washers were imported from China the new duty would be 5.8% + 10% or a total of 15.8%.

This looks simple enough, but the problem is that the first Trump administration already imposed a 25% tariff on certain goods from China (9903.88.01) using very similar language. That earlier tariff applied a duty equal to “The duty provided in the applicable subheading + 25%.” Following the language of this provision means that you add the duty from the applicable subheading tariff to the additional duty for this tariff to get the final duty value. For heading 8807, and other classifications that have a zero duty rate, this means that the net duty is 25%. This duty must be paid in addition to the 10% duty described in the prior paragraph (net 35% duty).

The scope of the original 25% duty is limited to a (long) list of HTSUS headings, so make sure your import is actually covered by that list if you are considering applying this tariff code (many aircraft parts are covered).

If you examine a product with a non-zero duty under the directly-applicable tariff codes, you run into an interesting problem. You are paying double-duty! Look at the steel lock washers imported under heading 7318. They are subject to 5.8% duty, so if steel lock washers were imported from China the 9903.88.01 duty would be 5.8% + 25% or a total of 30.8%. The sum of the two duties (9903.01.20 and 9903.88.01) would be 46.6% because both of then incorporate the base duty that applies directly to the product.

I’m not sure that was the intended result. I suspect it was meant to be a total additional tariff of 35% plus the base tariff for the subheading that applies to the goods. But the way that the two tariffs are written you end up paying the duty associated with the product’s applicable subheading twice. It remains to be seen whether this will be corrected, or if the double-base-duty will be enforced.

Either way you will need to declare both tariffs (9903.01.20 and 9903.88.01) if you are importing affected goods from China. Despite the delayed publication in the Federal Register, the new China tariff applies to all goods imported on or after February 5 (last week).