TL;DR: Section 301 is still the China-origin layer importers cannot ignore. Most affected Chinese goods still model at 7.5% or 25% on top of the MFN base rate, while selected strategic categories from the USTR four-year review reach 50% or 100%. The practical question is not “is there a tariff?” It is “which HTS line, which Chapter 99 line, which exclusion, and what does that do to gross margin?”
Tariff news moves fast, but margin math is brutally plain. If your unit economics were built on a 35% gross margin and the duty stack adds 25 percentage points, you did not lose “some margin.” You may have lost the product.
This guide is written for importers, Amazon / Shopify sellers, and operators who need a planning answer before the broker gives a filing answer. It is not legal advice. Use it to prepare the right questions and attach the right sources.
What Section 301 is, in one paragraph
Section 301 comes from the Trade Act of 1974. It lets USTR impose remedies after finding that a foreign country’s practices are unreasonable or discriminatory and burden U.S. commerce. The China action began with the 2017 technology-transfer investigation and became Lists 1, 2, 3, and 4A starting in 2018 and 2019. Unlike short emergency tariff layers, Section 301 is not a 150-day tool. It has lasted for years because it rests on a separate statutory record.
That distinction matters. Court rulings and policy fights over other tariff authorities do not automatically remove Section 301.
The 2026 rate picture
The operating baseline most importers still need to model:
| Section 301 bucket | Typical current rate | Common product exposure |
|---|---|---|
| Lists 1 and 2 | 25% | Industrial machinery, electronics components, inputs |
| List 3 | 25% | Furniture, lighting, consumer electronics, miscellaneous goods |
| List 4A | 7.5% | Apparel, footwear, some consumer goods |
| List 4B | Suspended | Phones, laptops, many toys, some consumer electronics |
| Strategic increases | 25%-100% | EVs, batteries, solar, semiconductors, critical minerals |
USTR’s four-year review created the biggest recent rate changes. Public USTR materials describe increases such as 100% for electric vehicles, 50% for solar cells, and 50% for semiconductors on the relevant effective schedules. Your exact answer still comes from the HTS classification and Chapter 99 instruction, not from the headline category.
Margin math: five planning examples
The examples below are planning models. They are deliberately simple so you can see how each layer changes the result.
| Product | Likely HTS family | MFN base | Section 301 layer | Planning combined rate before other layers |
|---|---|---|---|---|
| Cotton T-shirt | 6109.10 | 16.5% | 7.5% | 24.0% before any temporary/global layer |
| Wood furniture | 9403.60 | often 0% | 25% | 25.0% before AD/CVD and product-specific layers |
| LED lighting | 9405 | often low single digits | 25% | roughly high-20s before other layers |
| Lithium-ion power bank | 8507.60 | often low single digits | 25% strategic layer | roughly high-20s before other layers |
| Solar cells/modules | 8541.43 | often free base | 50% strategic layer | 50.0% before other trade remedies |
The trap is thinking a “free” MFN base rate means a low duty bill. For China-origin goods, the Section 301 layer often matters more than MFN.
How to calculate the margin impact
Use this planning formula:
Duty stack = MFN base duty + Section 301 + product-specific trade remedies + fees
New gross margin =
(selling price - product cost - freight/insurance - duties - platform/fulfillment costs)
/ selling priceExample:
Selling price: $30
Landed pre-duty cost: $16
Section 301 planning layer: 25%
Duty on $16 customs value: $4
New landed cost: $20
Gross margin before platform fees: 33.3%If the product previously had a 46.7% gross margin before duty, a 25% duty layer cut roughly 13 margin points. That is why a “25% tariff” can be the difference between a hero SKU and a dead listing.
Exclusions: the expensive thing teams forget to check
Section 301 exclusions are claimed through Chapter 99 lines, commonly in the 9903.88.xx family. If your product qualifies but your entry summary does not claim the exclusion correctly, the duty can still be charged. If your product does not qualify, wishful thinking does not create an exclusion.
For every China-origin SKU, keep a source-backed checklist:
- Primary 10-digit HTS classification.
- Applicable Section 301 list and Chapter 99 line.
- Active exclusion status and expiration date.
- AD/CVD exposure.
- Section 232 or other product-specific exposure.
- Broker confirmation or CBP ruling path.
China vs alternate origin: don’t compare only duty
Moving a SKU from China to Vietnam or Mexico can reduce the Section 301 layer, but it does not make sourcing free. You still need to model:
- Higher manufacturing cost.
- Tooling and transition risk.
- Freight and lead-time changes.
- Substantial transformation and origin documentation.
- USMCA qualification if using Mexico.
The useful formula is:
Net savings = China combined duty rate - new origin combined duty rate - new origin cost premiumIf Vietnam saves 25 duty points but manufacturing cost rises 18%, the real gain may be 7 points. If the operational risk is high, it may not be worth it.
What to do this week
Start with the SKUs that produce the most gross profit, not the most revenue. For each one, create a small review packet:
- Product description and photos.
- Current HTS code and why you use it.
- MFN base rate source.
- Section 301 list / Chapter 99 source.
- Exclusion status.
- Landed-cost estimate with assumptions separated from sourced values.
Then hand that packet to your broker. A broker can review a packet faster than a spreadsheet full of unlabeled rates.
Use the free landed-cost calculator for the math and the HS / HTS lookup to capture source URLs and retrieval dates.
Sources to verify
- USTR Section 301 four-year review.
- Federal Register notices for Section 301 modifications and exclusions.
- USITC HTS for MFN base rates and Chapter 99 instructions.
- CBP CROSS for classification and origin rulings.
Last updated: May 13, 2026.
Planning estimate only. TariffsChart is not a customs broker, law firm, or official customs database.
