President Trump signed Executive Order 14326 on July 31, 2025, further modifying the reciprocal tariff rates first established under Executive Order 14257 of April 2, 2025, which declared a national emergency over large and persistent U.S. goods trade deficits. The new order sets trading partner-specific additional ad valorem duty rates listed in Annex I, replacing previously imposed duties under EO 14257 as amended. The modifications take effect at 12:01 a.m. eastern daylight time on August 7, 2025, seven days after signing. The order does not alter or affect Executive Order 14298 of May 12, 2025, which addressed tariff rates specific to the People’s Republic of China.
What it means
Importers will face new trading partner-specific duty rates on goods entered for consumption on or after August 7, 2025. Goods already loaded onto a vessel and in transit before that date, and entered for consumption before 12:01 a.m. on October 5, 2025, remain subject to the prior duties under EO 14257 as amended rather than the new rates. Trading partners not listed in Annex I continue to face a 10 percent additional ad valorem duty under EO 14257 as amended. For European Union goods, the order sets a combined duty floor: where a good’s Column 1 duty rate is below 15 percent, the Column 1 rate and the additional ad valorem rate together equal 15 percent. A set of existing HTSUS headings covering reciprocal tariff classifications — 9903.01.43 through 9903.01.62 and 9903.01.64 through 9903.01.76 — are suspended until Annex II modifications take effect, at which point they are terminated as to future entries and replaced by new trading partner-specific headings.
The order adds an anti-circumvention mechanism: goods CBP determines to have been transshipped to evade applicable duties are subject to an additional ad valorem rate of 40 percent in lieu of the otherwise applicable rate, plus applicable fines, penalties, duties, fees, taxes, and other charges. CBP is barred from mitigating or remitting penalties on such imports. The Secretaries of Commerce and Homeland Security, acting through the CBP Commissioner and in consultation with the U.S. Trade Representative, are directed to publish every six months a list of countries and specific facilities used in circumvention schemes. The Secretary of Commerce and the U.S. Trade Representative, in consultation with the Secretary of Homeland Security, CBP Commissioner, and Chair of the U.S. International Trade Commission, may make additional HTSUS modifications through Federal Register notice.
Key facts
- Executive Order number: 14326, signed July 31, 2025
- Effective date: 12:01 a.m. eastern daylight time, August 7, 2025
- In-transit exemption deadline: goods must be entered for consumption before 12:01 a.m., October 5, 2025
- Default additional duty for unlisted trading partners: 10 percent ad valorem under EO 14257 as amended
- EU combined duty floor for goods with Column 1 rate below 15 percent: 15 percent total
- Transshipment/evasion penalty rate: 40 percent additional ad valorem, plus other applicable penalties and charges; no mitigation or remission permitted
- Circumvention list publication frequency: every 6 months, by Commerce and DHS/CBP in consultation with USTR
- Legal authority: IEEPA (50 U.S.C. 1701 et seq.), National Emergencies Act (50 U.S.C. 1601 et seq.), Trade Act of 1974 section 604 (19 U.S.C. 2483), 3 U.S.C. 301
Source: White House Executive Order 14326 (whitehouse.gov)