Section 122 Tariff Surcharge: What It Is, What It Costs, and When It Expires

Section 122 of the Trade Act of 1974 authorizes the President to impose a temporary surcharge on imports to address balance-of-payments deficits. Starting April 2025, the current administration invoked Section 122 to apply a 10% surcharge on most US imports. This surcharge expires July 24, 2026 — giving importers a clear deadline to plan around.

What Is the Section 122 Surcharge?

The Section 122 surcharge (also referred to as the IEEPA universal tariff in some filings) adds 10% to the customs value of most imports entering the United States. Unlike Section 301 (which targets China) or Section 232 (which targets steel, aluminum, and autos), Section 122 is a broad, country-neutral surcharge.

Key facts:

Detail	Value
Rate	10% of customs value
Effective date	April 9, 2025
Expiration date	July 24, 2026
Countries affected	Most (China, Vietnam, India, UK, EU, etc.)
Authority	Trade Act of 1974, Section 122
Cumulative	Yes — stacks on top of MFN, Section 301, Section 232

Which Imports Are Affected?

The 10% surcharge applies to the vast majority of US imports. Specific exemptions include:

• Certain critical goods (medical supplies, medicines) — check CBP rulings
• Goods from Canada and Mexico under USMCA for qualifying imports
• Goods already subject to reciprocal tariff arrangements at higher rates

For practical purposes, assume all commercial imports face the 10% surcharge unless you have a specific CBP ruling confirming exemption.

How Much Does Section 122 Cost?

Section 122 is applied to the dutiable value (goods + shipping). The dollar impact scales directly with shipment size:

Shipment Value	Section 122 Cost (10%)	Annualized (monthly shipments)
$1,000	$100	$1,200/year
$5,000	$500	$6,000/year
$10,000	$1,000	$12,000/year
$50,000	$5,000	$60,000/year
$100,000	$10,000	$120,000/year

For a business importing $1M/year of goods, Section 122 alone adds $100,000 in annual duties that disappear on July 24, 2026.

Section 122 Cost Impact by Country and Product

Section 122 combines with other tariffs. Here's what it adds to total landed cost across common scenarios:

Scenario	Without Sec. 122	With Sec. 122 (until Jul 2026)	Savings After Expiry
Electronics from China ($10K)	~$3,267 duties	~$4,267 duties	$1,000
Apparel from Vietnam ($10K)	~$1,650 duties	~$2,650 duties	$1,000
Furniture from Mexico ($10K)	~$0 duties (USMCA)	~$1,000 duties	$1,000
Steel goods from Germany ($10K)	~$2,800 duties	~$3,800 duties	$1,000

The savings after expiry are always exactly 10% of customs value — regardless of origin or product category.

Countdown to Expiration: July 24, 2026

As of April 16, 2026, Section 122 expires in 99 days.

This creates real import timing considerations:

Order Before or After Expiry?

Decision	Tradeoff
Import before July 24	Pay 10% extra, but receive goods sooner
Delay until after July 24	Save 10% on duties, but delay inventory by weeks/months
Split order	Get partial inventory now, save on remainder

For large orders ($50,000+), waiting a few extra weeks can save thousands. For just-in-time inventory, the cost may be worth it.

Watch for Extension Risk

Section 122 has a statutory maximum duration under the Trade Act. However, the administration could:

• Issue a new executive order under different authority (e.g., IEEPA) at expiry
• Extend the surcharge if balance-of-payments conditions persist
• Replace it with a different trade action

TariffCheck automatically shows both your current landed cost (with 10% surcharge) and the post-July-24 cost (without the surcharge), so you can model both scenarios.

Section 122 vs. Other 2026 Tariffs: Comparison

Many importers confuse Section 122 with other tariff actions. Here's a clear comparison:

Tariff	Section	Rate	Countries	Duration
MFN duties	HTS Schedule	0–37.5%	All WTO members	Permanent
Section 301	Trade Act 1974 §301	7.5–100%	China only	Indefinite
Section 232	Trade Expansion Act §232	25%	All (steel/aluminum/autos)	Indefinite
Section 122	Trade Act 1974 §122	10%	Most countries	Expires Jul 24, 2026
Reciprocal tariffs	Various	Varies	Specific countries	Varies

Section 122 is unique because:

1. It has a fixed expiration date (July 24, 2026)
2. It applies broadly across all product types
3. It applies across most countries simultaneously
4. It adds predictable dollar amounts — exactly 10% of customs value

Planning Strategies for Importers

If You're Currently Importing Regularly:

1. Calculate total Section 122 cost — multiply your annual customs value by 10%
2. Model post-July-24 costs — use TariffCheck to see your new landed cost
3. Reprice accordingly — if you've been passing duty costs to customers, prepare to reduce prices (or improve margins) after July 24
4. Consider timing large orders — if a big order can wait until August without hurting operations, save the 10%

If You're Planning to Start Importing:

1. Don't let Section 122 kill a good deal — it expires in under 100 days
2. Factor it into unit economics — $0.10 per dollar of goods is a real cost until July 24
3. Start supplier qualification now — so you're ready to import at scale when the surcharge lifts

For E-Commerce Sellers:

1. Pricing: Build in the 10% for current inventory; plan a slight price reduction or margin capture for post-July-24 restocks
2. Inventory timing: If you're planning a large Q3 restock, placing orders now for July delivery means you may pay 10% extra — July 25 delivery means you don't
3. Competitor analysis: Competitors sourcing the same products all face the same 10% — the field is level until July 24

Frequently Asked Questions

Does Section 122 apply to goods already in transit?

Section 122 typically applies at the time of entry (when CBP processes the import), not when the goods were shipped. Goods shipped before the expiry date but entering the US after July 24, 2026 may not be subject to the surcharge — verify with CBP or a customs broker.

Is Section 122 separate from the reciprocal tariffs on specific countries?

Yes. Section 122 is a baseline 10% surcharge. Some countries face additional "reciprocal" tariffs on top of this. For example, goods from countries with high tariff rates on US exports may face additional duties beyond the 10% baseline.

Does Section 122 apply to Section 321 (de minimis) shipments?

CBP guidance on de minimis treatment under Section 122 has evolved. Check current CBP rulings at cbp.gov. As of 2026, Chinese goods may face special treatment at the de minimis threshold.

Can I get a refund of Section 122 duties if it's ruled unlawful?

Legal challenges to Section 122 are possible. The Court of International Trade has jurisdiction over customs matters. If a court ruling invalidates the surcharge, CBP may process refunds — but this is speculative. Don't plan business decisions around potential refunds.

What replaces Section 122 after it expires?

Nothing automatically replaces it — the 10% surcharge simply ends. However, the administration could issue new tariff actions after July 24. Monitor USTR and CBP announcements closely as the expiry date approaches.

Conclusion

Section 122 adds 10% to most US imports and expires July 24, 2026. That's $100 per $1,000 shipment — substantial but temporary. Plan your import timing, model your post-July-24 costs, and don't let it derail a sound sourcing strategy. Use TariffCheck to see exactly how much Section 122 adds to your specific shipment, and what your landed cost will be on July 25. Calculate your Section 122 impact free →