US Introduces 10% Tariff Under Section 122 of the Trade Act of 1974

On 20 February 2026, a presidential proclamation titled “Imposing a Temporary Import Surcharge to Address Fundamental International Payments Problems” was issued, introducing a temporary additional import surcharge of 10% ad valorem on imported goods from all countries.

The measure was adopted under Section 122 of the Trade Act of 1974 and will apply for a period of 150 days.

Period of application

The additional surcharge applies to goods entered for consumption or withdrawn from warehouse for consumption during the period from 24 February 2026 at 00:01 ET until 24 July 2026 at 00:01 ET.

Scope of the measure

The additional 10% surcharge applies to goods originating in any country unless they are explicitly covered by one of the exemptions under HTSUS headings 9903.03.02–9903.03.11.

Goods subject to the measure should be classified under HTSUS heading 9903.03.01.

Main exemptions from the additional surcharge

1. Goods in transit

Goods loaded on a vessel and in final transit to the United States before 24 February 2026 that are entered for consumption by 28 February 2026.

2. Certain agricultural and specific products

Including selected tropical fruits, acai products, coconut water, certain citrus juices and specific products for religious purposes. Specific HTSUS tariff subheadings apply.

3. Civil aviation

Civil aircraft other than military aircraft, together with their engines, parts, components and ground flight simulators.

4. Certain industrial products

Including iron and steel articles, aluminium products, passenger and commercial vehicles and parts, semiconductors, semi-finished copper and copper products, and certain wood products.

5. Goods under free-trade agreements

• Goods originating in Canada and Mexico entered duty-free under USMCA
• Certain textile and apparel products under DR-CAFTA

6. Donations

Food, clothing, medicine and other goods intended to relieve human suffering.

7. Informational materials

Publications, films, CDs, works of art and other informational materials.

Special regimes

Chapter 98 of the HTSUS

In most cases, goods entered under Chapter 98 provisions are not subject to the additional surcharge, except under certain subheadings, including 9802.00.80 and some cases involving repair, processing or assembly abroad, where the surcharge is calculated on the value added.

Foreign Trade Zones (FTZ)

Goods subject to the surcharge and admitted to a foreign-trade zone after 24 February 2026 must generally be admitted under “privileged foreign status” unless they qualify for “domestic status”. The applicable rate will be the rate in force at the time of admission to the zone.

Drawback

The additional duties imposed under the proclamation are eligible for drawback where the relevant conditions are met.

Additional context

At present, no information has been published regarding possible refunds of previously paid IEEPA tariffs. The matter has been returned to a lower court and no timetable or refund procedure has been announced.

What does this mean for importers?

Given the broad scope of the measure, importers should consider:

• reviewing tariff classification across all active import flows
• analysing contractual terms and pricing mechanisms
• assessing opportunities to use drawback
• reviewing strategies involving Foreign Trade Zones
• documenting the intended use of goods where applicable, as required by CBP

Conclusion

The temporary 10% import surcharge under Section 122 could materially affect US import costs in the coming months. Given the short implementation period and the complexity of the exemptions, timely analysis is important.

Our team is monitoring the regulatory framework and customs guidance and is available for individual consultation on how the measure may apply to your specific shipments.