A Plain-English Guide of Section 301 Tariffs

Understanding Section 301 Tariffs

A plain-English guide of Section 301 tariffs starts with one simple question: why do these tariffs exist? Section 301 of the Trade Act of 1974 gives the U.S. Trade Representative (USTR) authority to investigate and respond to foreign trade practices deemed “unreasonable or discriminatory.” The USTR’s 2018 investigation concluded that China’s intellectual property and technology transfer practices caused harm to U.S. commerce, triggering the tariff actions that continue to affect sourcing decisions today.

The Four Lists and What They Cover

Section 301 tariffs were rolled out in tranches. Each tranche covers a different set of HTS codes:

• List 1 (25% tariff): Primarily industrial goods, machinery, and aerospace components. Covers approximately $34 billion in trade.
• List 2 (25% tariff): Semiconductor and chemical products, plastics, railway equipment. Covers approximately $16 billion in trade.
• List 3 (25% tariff): A broad range of consumer and industrial products including furniture, electronics, and textiles. Covers approximately $200 billion in trade.
• List 4A (7.5% tariff) and List 4B (suspended): Consumer goods including clothing, footwear, and consumer electronics. List 4B was suspended under the Phase One trade deal and has not been fully implemented.

A common trap we see with procurement teams is assuming List 3 is less impactful because it carried a lower original rate. Many List 3 products were raised to 25% in May 2019, making them as impactful as Lists 1 and 2.

How to Check If Your Product Is Affected

The most reliable method is to look up your product’s 8 or 10-digit HTS code in the USTR’s official Federal Register notices. CBP also maintains a Section 301 FAQ page that links to the relevant tariff lists. The process:

1. Identify your product’s HTS code using the CBP online classification tool or a licensed customs broker.
2. Cross-reference the HTS code against the USTR’s published lists for Lists 1, 2, 3, and 4A.
3. Check the current tariff rate column — rates have been modified multiple times since 2018.
4. Review any active exclusion orders that may temporarily exempt your specific HTS code.

A Plain-English Guide of Section 301 Tariffs: Exclusions and Exemptions

The USTR has periodically opened exclusion processes allowing U.S. importers to apply for a temporary exemption from Section 301 tariffs on specific products. Exclusions are granted product by product, are retroactive to the date of the tariff imposition, and have expiration dates. In our experience, many small importers are unaware that exclusions exist or assume the application process is too complex to pursue.

Key points about exclusions:

• Exclusions are product-specific, not company-specific. If an exclusion is granted, any importer of that product can claim it.
• Exclusions require precise HTS code matching. A single digit difference in classification can disqualify your claim.
• Expired exclusions are not automatically renewed. You must monitor USTR announcements for reinstatement notices.

Keeping up with changes to trade rules is an ongoing requirement. Our article on new WTO rules in 2026 provides additional context on the evolving global trade compliance landscape.

Sourcing Strategies to Reduce Section 301 Exposure

Procurement managers are not without options. The strategies most widely used to manage Section 301 tariff costs include:

• Supplier diversification: Shifting sourcing to non-China origins such as Vietnam, Indonesia, Mexico, or India for affected product categories. Countries of origin matter for tariff purposes — goods manufactured in Indonesia, for example, are not subject to Section 301 tariffs.
• HTS reclassification review: Working with a licensed customs broker or trade attorney to confirm whether your product is correctly classified. Reclassification to an unaffected HTS code, when legally supportable, eliminates the tariff entirely.
• First Sale valuation: Where goods pass through a middleman before import, the First Sale rule may allow you to declare customs value at the manufacturer price rather than the broker or trading company price, reducing the dutiable value.
• Bonded warehouse and FTZ strategies: Storing goods in a Foreign Trade Zone or bonded warehouse can defer tariff payment and, in some cases, allow for further manufacturing that changes the classification.

For compliance best practices that support a diversified sourcing approach, review our guide on how to pass an export compliance audit.

Common Pitfalls and Expert Tips

Pitfall 1: Assuming your supplier pays the tariff. Section 301 tariffs are paid by the U.S. importer of record, not the foreign seller. Even if your contract says “DDP” (Delivered Duty Paid), the structural cost of the tariff is typically built into the price you pay.

Pitfall 2: Ignoring country of origin rules. Simply having goods shipped through a third country does not change the origin for tariff purposes. CBP applies substantial transformation and country-of-origin rules strictly. Transshipment schemes to evade Section 301 tariffs have resulted in penalty cases, seizures, and fraud referrals.

Expert Tip: Maintain a tariff impact register — a spreadsheet that maps each of your key product HTS codes against the applicable Section 301 list and current tariff rate. Review it quarterly or whenever a Federal Register notice announces changes.

For official USTR information on Section 301, visit the USTR Section 301 investigations page. For a list of affected HTS codes and CBP guidance on payment, see the CBP Section 301 FAQs.

---

TheExporter.co sources and exports authentic, handmade Indonesian furniture and goods — products manufactured outside China and therefore not subject to Section 301 tariffs. If you are looking to diversify your sourcing to reduce tariff exposure, our product range may be worth exploring.

---

Frequently Asked Questions About Section 301 Tariffs

Are Section 301 tariffs still in effect in 2026?

Yes. Section 301 tariffs on Chinese goods remain in effect across Lists 1, 2, 3, and 4A. Tariff rates and product exclusions can change through executive action or new USTR proceedings. Always verify current rates against the most recent Federal Register notices before making sourcing decisions.

How do I find out if my product is on a Section 301 list?

Use the USTR’s published Federal Register notices or the CBP HTS classification tool to look up your 8-digit or 10-digit HTS code. Many customs brokers and trade software platforms also offer tariff lookup tools that flag Section 301 applicability automatically.

Can I get a refund if my product was subject to Section 301 tariffs but an exclusion was later granted?

Yes. Approved exclusions are typically retroactive, meaning you can file for a refund of duties paid during the exclusion period. The refund is claimed through CBP’s protest process. Time limits apply, so work with your customs broker promptly once an exclusion is confirmed.

Does sourcing from a country other than China avoid Section 301 tariffs?

Yes, if the goods are genuinely manufactured or substantially transformed in a non-China country. Section 301 tariffs apply to goods originating from China. Products made in Vietnam, Indonesia, India, or Mexico, for example, are not subject to these tariffs — but CBP scrutinizes origin claims closely.

What is the difference between Section 301 tariffs and Section 232 or Section 201 tariffs?

Section 301 targets unfair trade practices by specific countries (primarily China). Section 232 tariffs address national security concerns (e.g., steel and aluminum). Section 201 tariffs address import surges that harm domestic industries. Each has different legal bases, affected products, and procedural requirements.