Published April 17, 2026
IEEPA tariffs are the newest layer in what is now a complex multi-program duty stack on Chinese imports. If your landed cost model was built before 2025, it's missing these — and depending on your product category, that omission is meaningful. Here's what IEEPA is, what it added, and how to calculate its effect on your imports.
IEEPA stands for the International Emergency Economic Powers Act, a 1977 law that grants the President broad authority to regulate international commerce during a declared national emergency. It's not a trade-specific statute — it was originally designed for sanctions and asset freezes, not tariffs. The Trump administration used it in 2025 to impose tariffs on Chinese goods on national security and trade balance grounds.
The key legal difference from Section 301: Section 301 tariffs were imposed by the USTR following a formal investigation, with public comment periods, statutory findings, and ongoing exclusion processes. IEEPA tariffs are a direct executive action under emergency powers — faster to impose, faster to modify, and with fewer procedural constraints. This has two practical implications for importers:
First, IEEPA tariffs can be changed quickly — raised, lowered, or expanded to new product categories without the formal rulemaking process that Section 301 changes require. If you've been through multiple rounds of Section 301 changes, IEEPA moves faster.
Second, the exclusion process for IEEPA is limited. Section 301 has had multiple formal exclusion rounds where importers could petition for product-specific relief. IEEPA tariffs have had more limited exclusion availability, particularly in the early implementation phase. Don't plan around IEEPA exclusions the way some importers planned around 301 exclusions.
IEEPA tariffs on China were announced in early 2025 at an initial rate of 10% and subsequently increased in escalation steps as trade negotiations between the US and China produced limited results. As of mid-2026, the baseline IEEPA rate on most Chinese goods is 20%, with some categories at different rates based on executive orders modifying the original action.
The critical thing to understand: IEEPA rates apply to the same customs value that Section 301 rates apply to — they're not calculated on an already-tariffed value, but on the dutiable value of the goods (essentially FOB price plus CIF adjustments). So a 20% IEEPA rate is a genuine 20 percentage point addition to your combined duty rate.
Verify current rates before quoting any project. IEEPA rates have changed multiple times and are more likely to change again than Section 301 rates — the legal mechanism is designed for speed. Look up your current combined rate at lgistics.ai rather than relying on any single figure.
The total duty rate on a Chinese import is the sum of all applicable programs. There's no netting or phasing — each applies on top of the others to the dutiable value of the goods.
The full stack:
| Program | Basis | |---|---| | MFN (Most Favored Nation) | Standard tariff rate, varies by HTS code | | Section 301 | 7.5% to 25% depending on product list | | IEEPA | ~20% for most goods (verify current rate) | | AD/CVD (if applicable) | Product-specific, can be very high |
Worked example — industrial fasteners (bolts and screws), HTS 7318.15:
On a $5.00 FOB unit, that's $2.56 in duties. Before freight, before broker fees, before any domestic handling, your $5.00 FOB part is already $7.56 in import cost. Factor in ocean freight (~$0.30-0.50 for hardware at density), and you're looking at $8.00+ landed before domestic costs.
Another example — plastic consumer product, HTS 3926.90 (general plastic articles):
At a $2.50 FOB price point, duties are $1.26/unit. This is why many consumer goods importers who were profitable in 2022 are not profitable in 2026 without price increases or supply chain changes.
IEEPA tariffs apply broadly to Chinese goods — they're not product-specific the way Section 301 lists are. The categories where IEEPA hurt most are those where Section 301 rates were already lower (List 4A at 7.5%), where adding 20% IEEPA pushed the combined rate past a threshold that makes US or third-country manufacturing competitive:
For categories already at 25% Section 301 (Lists 1-3), the IEEPA addition still matters but these importers had already built in higher tariff rates. For categories that were at 7.5% and were calculating based on that being the "real" rate, IEEPA was a significant surprise.
One important IEEPA provision directly targeted cross-border e-commerce: the administration used IEEPA authority to eliminate the de minimis exemption for goods from China. The de minimis exemption previously allowed goods valued under $800 to enter the US duty-free without formal customs entry. This exemption was heavily used by Chinese e-commerce platforms (Shenzhen-based direct-to-consumer sellers, in particular) to ship individual orders directly to US consumers without paying duties.
The elimination of de minimis for Chinese goods means those platforms now face the same duty burden as formal commercial importers. For importers competing with those platforms, this levels the playing field somewhat. For importers using Chinese 3PL or dropshipping arrangements through Chinese-origin addresses, the change creates compliance obligations that didn't previously exist.
IEEPA tariffs on China have already been modified multiple times since their initial imposition — paused, reinstated, and adjusted as part of ongoing trade negotiations. The legal mechanism allows the president to modify tariffs by executive order with limited lead time. Some categories have received temporary exclusions or rate reductions as part of trade negotiations; others have been increased.
Practically speaking, this means:
What doesn't change your IEEPA exposure:
What can reduce IEEPA impact:
For a full picture of legal strategies to reduce your total duty burden — including strategies that work on IEEPA — see our article on tariff engineering. For how IEEPA fits into the broader China tariff picture, see the China tariffs guide and our breakdown of Section 301 rates by category.
IEEPA added approximately 20 percentage points to the combined duty rate on most Chinese goods in 2025. For products already carrying 25% Section 301 rates, the total burden is now typically 30-50%+ depending on MFN. For products that were at 7.5% Section 301, the IEEPA addition was more unexpected and proportionally larger.
Any cost model for Chinese-sourced goods built before early 2025 needs to be recalculated. The landed cost math changed materially, and importers who haven't updated their numbers are likely operating on margins that no longer exist.
Ready to source?
Not sure how tariffs affect your costs? Get quotes from both US and China manufacturers to compare real landed costs. Or use lgistics.ai to audit your current HTS classifications.