Breaking Down the Latest IEEPA & 232 Tariff Changes
On August 7th, 2025, President Trump issued executive orders amending the reciprocal tariff rates. Currently these new executive orders do not change the interplay between the 232 and IEEPA/Reciprocal tariffs. Whereas goods that are subject to the Aluminum 232 tariff are not simultaneously subject to the IEEPA/Reciprocal tariffs as well.
The effective date for the IEEPA/Reciprocal tariffs is August 7th, 2025. Read the executive order which includes the list of affected countries in Annex I (Read the EO Here)
There are some exceptions:
- The new 35% IEEPA/Reciprocal tariff rate for Canada was effective on August 1st, 2025. However, goods that comply with the USMCA will continue duty free and the current 232 rate applies.
- Countries not listed in Annex I (i.e. Mexico and China) will remain subject to the 10% rate. The current agreement with China holds the rate until August 12th, 2025. Aluminum Extrusions from China are still subject to current AD/CVD rates, 301, and 232 rates. Mexico has been given a 90-day extension.
- Imports from Brazil will remain at a 10% rate with the additional 40% imposed on Brazil as a separate action.
- European Union - If an import from the EU is at the 15% rate, no additional duties are being levied. If current duty rates on a good are less than 15% the total duty rate to the good will be applied at 15%.
It is important to note that the "Framework" agreements recently announced (i.e. EU, Vietnam, etc) only set the basis for negotiation. The application of these agreements will not be fully known until the negotiations are complete. In the case of the UK General Terms Agreement the terms outline “at a future time the Sec. of Commerce in consultation with USTR shall design and establish a Tariff-Rate Quota (TRQ) for aluminum articles and derivative products of the UK and this TRQ will be consistent with the purpose of the order.”
It is important to point out that the Full Value of Aluminum (FVA) is what is tariffed: FVA = Metal + Extrusion Conversion + “Value-ad”. Unfortunately, due to inconsistent guidance from CBP some importers are only claiming the value of the aluminum in the imports. This is incorrect.
The following are two examples of tariff codes to aid in the explanation of the current condition:
7604 Aluminum Bar, Rods and Profiles
- All Countries (except China): 232 % + FVA = Import Price
- Canada/Mexico: 7604 is covered under USMCA and therefore IEEPA/Reciprocal does not apply
- Rest of the world (minus China): the full value of the good is tariffed under 232 and therefore the IEEPA/Reciprocal does not apply
- China Rate = FVA + AD/CVD% + 232% + 301% + IEEPA/Reciprocal Rate
7610 Aluminum Windows and Doors (covered under the Derivative Products List)
- All Countries (except China) = (FVA + 232%) + (IEEPA/Reciprocal Rate + The remaining value of the import)
- If the shipments of goods in the 7610 categories qualify under USMCA rules from Canada or Mexico, then the IEEPA/Reciprocal tariffs do not apply
- China = (FVA + 232%) + (Full Value of the import + AD/CVD% + 301%)
As further clarity is provided, we will continue to provide updates as appropriate.
