The Trump Administration issued Executive Order 14289 on April 29, 2025, to clarify the extent to which its recent imposed (and proposed) tariffs are cumulative to each other in specific instances. The clarification was meant to illustrate how the tariffs “stack” in conjunction with one another to add up to a total tariff burden for particular imports.
However, numerous client inquiries suggest that the clarification itself may not have been as clear as intended.
The Order notes that the various tariffs have “separate and distinct” policy purposes and should not all cumulatively stack on top of one another in applying to the same article when imported, as that may result in a tariff rate that “exceeds what is necessary to achieve the intended policy goals” in certain cases.
Note that the Order, which has an effective date of May 16, 2025, is retroactively applicable to goods entered on or after March 4, 2025. Importers will have the ability to apply for refunds; Customs and Border Patrol (CBP) official guidance on how to do so is expected by the May 16 effective date.
The clarification generally indicates that Section 232 tariffs, while fully applicable, do not “stack” (that is, are not calculated as part of the value on specific items) on imports to which other tariffs are applied. There are exceptions—for example, Section 232 steel and aluminum duties, where applicable, will still be cumulative; but only with each other.
Specifically, the order provides for a priority — and in some cases, exclusivity—of duties in situations where multiple tariffs potentially apply. The range of those tariffs includes:
An example of tariffs not stacking under the new order are specific imported items subject to Section 232 tariffs on automobiles and auto parts. The 25% steel and aluminum duties under Section 232 will not apply or stack with those imports. Similarly, in the case of Mexico and Canada, items that will be subject to the Section 232 tariffs on steel and aluminum will not also be subjected to the 25% duty on non-USMCA qualifying products; and vice-versa.
The country-specific, “reciprocal” tariffs initially announced in early April and expected to be implemented on July 9, 2025, (on top of the current 10%) will also stack with all other non-Section 232 duties, including antidumping/countervailing duties, anti-opioid, and general HTS-based duties.
For China, the only country for which reciprocal tariffs are currently in effect, this means that a total duty rate will include 25% on steel and aluminum products or auto parts not otherwise covered by Section 232 tariffs; universal tariffs of 10%, country-specific opioid-based duties of 20%, “reciprocal” tariffs of (currently) 125%; a general applicable HTSUS tariff rate; and any product-related Section 301, antidumping and countervailing duty rates will all still apply.
Additional duties on imported automobiles and auto parts have been in effect since April 3, 2025. The April 29 Order states that the rates on auto parts will be adjusted based on the Administration’s “assessment of the national security risk associated with each part.”
The new rules include reduced duties applicable until April 2026 for auto parts that account for a maximum of 15% of the MSRP value of a vehicle “assembled in the United States.” After that, the threshold for eligible parts will be 10% of the MSRP value through April 30, 2027. Eligible manufacturers may apply for a duty offset equal to 3.75% of the aggregate MSRPs of all automobiles assembled in the U.S. through April 30, 2026, and of 2.5% of the MSRPs of such vehicles through April 30, 2027. Specific instructions on applying for the duty offset are expected to come from CBP shortly.
All concerned parties are aware that the tariffs—in effect and proposed—and the rules pertaining to them, are subject to sudden and sometimes dramatic change as negotiations proceed and policies are revised. There will certainly be more change to come, demanding close and consistent monitoring. Phillips Lytle’s International Business Practice attorneys are standing by to provide further guidance in navigating the tariff-impacted landscape.
Additional Assistance
For more information please contact James Kevin Wholey at (202) 617-2714 or jwholey@phillipslytle.com; any member of the Phillips Lytle International Business Law Team; or the Phillips Lytle attorney with whom you have a relationship.
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