2026 US Tariff Adjustments: What Global Sellers Must Know

In February 2026, US tariff policy underwent significant changes within just a few days. For cross-border e-commerce sellers, brand owners, and manufacturers shipping from China to the US, these rapid changes directly impact landed costs, pricing strategies, profit margins, and inventory planning.

The emergency tariffs imposed by the US under the International Emergency Economic Powers Act (IEEPA) have been repealed, but a broad temporary surcharge under Section 122 now applies to most imported goods. This surcharge builds upon the existing Section 232/301 tariffs. Therefore, importers must quickly adjust landed costs and reduce logistics expenses.

As an international order fulfillment service provider, Chinadivision closely monitors regulatory changes and proactively helps clients reduce risk and control logistics costs.

What is IEEPA?

The International Emergency Economic Powers Act (IEEPA) is a US federal law that grants the President the power to regulate international trade after declaring a national emergency.

Under the International Emergency Economic Powers Act (IEEPA), the president can: freeze overseas assets; block financial transactions; restrict trade activities; and implement emergency economic measures. While originally designed to address national security emergencies, the IEEPA has recently been used as the legal basis for imposing broad import tariffs.

What are IEEPA tariffs?

Tariffs established under the IEEPA are characterized by: rapid implementation; broad scope; applicability to multiple categories; and justification based on emergency authorization rather than standard trade procedures.

By 2025, IEEPA supports measures such as a 10% global tariff on many imported goods.

However, because the IEEPA was not originally designed for general trade tariff programs, it faces legal challenges.

Tariff adjustments in 2026: What is the actual situation?

In February 2026, the Supreme Court ruled that the IEEPA did not authorize the president to impose tariffs and declared existing global and country-specific IEEPA tariff schemes invalid by a 6-3 vote. The court explicitly stated that tariff powers belong to Congress, and using IEEPA as a general tariff tool is illegal.

In response, President Trump issued an executive order and proclamation imposing a temporary global import surcharge on all goods imported by all countries under Section 122 of the Trade Act of 1974, with an initial rate of 10% (ad valorem), effective 12:01 a.m. Eastern Time on February 24, 2026. Section 122 allows for surcharges of up to 15% for a maximum period of 150 days in balance-of-payments or related emergencies. This provision is independent of the International Emergency Economic Powers Act (IEEPA) and is not affected by the court ruling.

U.S. Customs and Border Protection (CBP) issued guidance confirming that tariffs based on the International Emergency Economic Powers Act (IEEPA) ceased to be levied as of February 24, and that the Section 122 surcharge now applies as a "regular tariff," levied in conjunction with most other tariffs, taxes, and fees. Meanwhile, the previous suspension of the minimum duty-free allowance for low-value imports remains in effect, meaning many small e-commerce parcels are still subject to tariffs.

The government has indicated its intention to raise the Section 122 surcharge to the statutory maximum of 15% during its effective period, which will further increase landed costs once U.S. Customs and Border Protection completes technical implementation. Sections 232 and 301 tariffs remain in effect, and under many HS codes, the Section 122 surcharge will be added on top of these other measures.

Professional guidance on Section 122 of the International Emergency Economic Powers Act and rising import costs:

This is practical business guidance only and not legal advice; specific compliance steps should be confirmed with a trade attorney or customs broker.

Reassess your tariff exposure in accordance with the law.

Separate legacy IEEPA tariffs (which may now be refundable) from the current Sections 232, 301, and the new Section 122 surcharges in your Enterprise Resource Planning (ERP) and landed cost model. This allows you to quantify past import tax refund opportunities while clearly understanding the incremental impact of the new surcharges on future freight.

Work with your broker to ensure that inbound declarations after February 24th use the correct Section 122 code and tax rate after the CBP system is fully updated, and correct any declarations that still incorrectly reference IEEPA.

Calculate modeled CIF costs under 10% and 15% surcharge scenarios separately.

The Section 122 tax rate is currently 10% and is expected to rise to 15%, so you should model your SKUs under both assumptions and adjust your pricing, discount strategies, and reorder points accordingly. This stress test helps identify low-margin, potentially unprofitable SKUs and determine which SKUs may require supplier changes or localization.

Reassess the Incoterms and who bears the surcharges.

Under DDP or similar terms, you, as the seller, may be liable for Section 122 duties; under DAP or FOB rules of origin, duties are paid by the buyer or downstream entity. Renegotiating terms or adopting country-specific pricing methods can more fairly distribute the impact of duties without harming profit margins.

Use Customs Procedures Carefully

For goods transiting through free trade zones, the new announcement requires that goods subject to Section 122 be granted "privileged foreign goods" status after the effective date, thus locking in the applicable tariff rate upon entry. This can prevent future tariff increases, but it can limit flexibility if tariffs decrease or exemptions expand.

Confirm that your products qualify for preferential conditions under USMCA, DR-CAFTA, or other free trade agreements to avoid some surcharges or basic duties.

Strengthen Classification and Valuation Discipline

Due to the addition of ad valorem tariff tiers, misclassification or overvaluation has a greater impact on the cost of each shipment. Strict HS classification review, consistent declared values, and proper handling of ancillary fees, royalties, and non-taxable charges are key aspects of cost control.

The 2026 tariff adjustments clearly demonstrate one thing:

tariff policies can change overnight.

Sellers relying solely on freight rate comparisons will struggle. Those who integrate compliance, logistics planning, and cost modeling will remain competitive.

Strategies for Controlling Logistics and Transportation Costs (Working with the ChinaDivision)

To defend profits under high tariffs, logistics optimization must offset tariff increases as much as possible; specialized companies like ChinaDivision can play a role in this.

Integrated and Smarter Transport Design

ChinaDivision can consolidate goods from multiple Chinese suppliers into its Shenzhen warehouse and merge them into fewer export shipments, thereby reducing per-piece freight, handling, and customs clearance costs. For e-commerce, this enables bulk imports to destination hubs and then local parcel delivery, which is often more economical than many direct cross-border parcels.

By optimizing carton configuration and palletization, they help improve average container utilization and air freight weight allocation standards, reducing transportation costs per kilogram or per unit even with higher tariffs.

Route and Transportation Mode Optimization (Air, Sea, Rail, Road)

ChinaDivision offers diversified international shipping routes, including sea, air, rail, and road transport. You can choose slower but lower-cost transportation modes for non-urgent inventory, while using air express only for high-margin or urgent SKUs. This hybrid transportation strategy smooths cash flow and reduces average freight costs, partially offsetting additional surcharges.

Compared to isolated direct shipping from factories, their proximity to major ports and Hong Kong's air and sea freight hubs allows them to select more competitive carriers and balance transit time and cost.

Warehouse Location and Inventory Control

With domestic and international warehousing solutions and integration of their proprietary ERP/WMS system with platforms such as Amazon, Shopify, and WooCommerce, ChinaDivision can bring buffer inventory closer to end customers, reducing urgent shipments and additional shipping costs due to stockouts. Clearer inventory visibility helps you optimize replenishment quantities and shipment sizes, minimizing warehousing and transportation costs.

Scanning and monitoring upon receiving goods at the warehouse reduces error and return rates, indirectly lowering the costs of duplicate shipments and re-clearance.

Customs Processing and Compliance Efficiency

ChinaDivision's professional customs brokerage team assists you in ensuring the accuracy of export documents and HS codes, and coordinates with your customs broker to ensure the accuracy of import documents and HS codes, thereby reducing customs delays, demurrage fees, and penalties, and lowering actual landed costs. Given that U.S. Customs and Border Protection (CBP) is adjusting its system to accommodate the new Section 122 regulations, clear and consistent documentation is particularly important, as incorrectly coded declarations may require costly subsequent corrections.

Value-Added Services to Protect Profit Margins

Services such as in-warehouse quality inspection, custom labeling, and repackaging allow product issues to be resolved in China before export, avoiding expensive returns or rework after tariffs and last-mile transportation costs have already been incurred. Customized packaging based on product size and carrier requirements can reduce volumetric weight costs, a significant driver of air parcel costs.

Contact Chinadivision today to arrange your shipment and protect your profits in this rapidly changing tariff environment.