Importers talk a lot about “managing tariffs,” but many are not actively managing tariff exemptions. That’s a costly oversight in an environment where duty rates on some products can reach 50%-60%.

“Every week it seems, things get more complicated, and it's just harder to stay on top of tariff rules, exemptions and compliance,” said Andrew Rozek, president of freight forwarder I.C.E. Transport, with offices in New Jersey, the UK and Poland. “Different tariff programs apply to different origins and commodities, and each has its own rules and exemptions. Without a deliberate strategy, importers may overpay.”

In this article we will look at where tariff exemptions still exist, how missteps happen, and why your HS codes, sourcing decisions, and broker’s diligence all have a direct impact on your total landed cost.

The Tariff Stack: Why Exemptions Matter More Than Ever

For many goods, tariffs are no longer a single surcharge, but are layered. China is the clearest example:

• Section 301 tariffs can be 7.5%, 15%, or 25%, depending on the product; there may be new tariffs under Section 301 based on ongoing investigations by the office of the U.S. Trade Representative (USTR).
• Section 122 tariffs represent a flat 10% on top of existing duty rates, valid for up to 150 days from Feb. 24, 2026
• Section 232 tariffs can be 15% to 50% depending on the commodity.

When these are combined, some shipments can still face very high effective rates, often in the 55%–60% range in extreme cases. But it’s important to note that not all tariffs stack the same way. For example, Section 301 and Section 232 can both apply to the same shipment, increasing the total burden.

By contrast, Section 122 does not apply when Section 232 is being charged, though Section 122 and base duty can both apply if only Section 301 is in effect. On top of that, there are commodity- and country-specific programs, such as steel and aluminum measures, Russia-related actions, plus product categories like upholstered furniture and cabinets.

There is a list of HS codes that are not subject to specific additional tariffs, for example, particular Section 301 lists. Separately, there is also an official list of HS codes that are not subject to Section 232 tariffs on steel and aluminum.

It can get pretty complex, which is why it’s a good idea to have a knowledgeable customs broker in your corner.

Sourcing Strategy: Avoiding Tariffs Before They Start

One way to reduce exposure is to avoid heavily penalized origins altogether. For North American shippers, Mexico and Canada remain attractive because many commodities are exempt under USMCA. That framework is under review in 2026 and may be renegotiated, but for now it still provides meaningful relief on qualifying goods.

All reciprocal tariffs are now gone thanks to the U.S. Supreme Court decision knocking down President Trump’s ability to impose them based on the International Emergency Economic Powers Act (IEEPA), setting up a complex refund process and lots of litigation. Based on this, importers can consider shifting sourcing to Europe, Africa, and Asia-Pacific countries not subject to China-specific surcharges.

In those cases, you may still face Section 122’s flat 10%, plus the product’s normal duty rate, but avoid the extra layers that apply specifically to China. For some products, that shift, combined with a preferential trade agreement, can dramatically reduce total tariff cost. The key is to evaluate sourcing decisions with the full tariff picture in mind.

Keep in mind that trade agreements would not eliminate Section 122, but they would eliminate the duty rate that would normally be charged in addition to Section 122.

Product-Level Tariff Exemptions: HS Codes Make or Break You

Beyond origin, some goods are genuinely exempt from specific tariff programs. The problem: those exemption lists are shrinking, and the differences can be very fine.

Take plywood, for example, a common construction material. Until October 2025, various types of plywood were exempt from certain tariffs. Then most exemptions disappeared, with one narrow exception: tropical wood plywood, a type not generally produced in the U.S. Birch or standard plywood is no longer exempt, while tropical wood plywood is.

This makes HS classification absolutely critical. The correct code for tropical plywood can legally preserve an exemption. A misclassification can mean paying 10% or more unnecessarily, or being flagged for incorrect entry.

Rozek said importers should study both the tariff schedule and the current exemption lists, then match them carefully to their actual products. “You have to be careful – you can save that way, but you also need to avoid creative coding that misrepresents your product and invites enforcement,” he added.

Origin Rules: No Shortcuts, Just More Scrutiny

Some importers have tried to escape tariffs via transshipment – routing goods through third countries and presenting them as originating there. This is a common tactic to avoid China-specific tariffs. CBP is increasingly aggressive in shutting that down.

Consider an electronics manufacturer in Poland that uses batteries imported from China. When those finished goods are sold to the U.S., the Chinese batteries may still trigger Chinese-origin tariffs on that portion, regardless of the final assembly point.

Southeast Asia is a common transshipment point. “People ship goods from China to Thailand, for example, and then somehow the documents would get changed and all of a sudden, the cargo is coming into the U.S. as originating from Thailand,” Rozek said.

CBP wants tariffs applied based on the true origin of the product or its key components, not simply the last port before the U.S. The practice of routing or “laundering” Chinese goods through Southeast Asia or Mexico and declaring them as originating in those countries are squarely in the agency’s sights. “CBP has stepped up enforcement to catch that kind of stuff,” Rozek said.

In short, legitimate tariff exemptions are available, but misrepresenting origin is not one of them, and it carries significant compliance risk.

Steel, Aluminum, and the Section 232 Revision to “Full Value”

Steel and aluminum measures under Section 232 are another area where rules have tightened over time, in part due to aggressive interpretation by importers. Initially, the rules seemed straightforward for raw materials like bars or rods, where origin and content are clear. But when steel and aluminum are components of finished goods, valuation becomes more complex.

CBP issues guidance on how to value such products, emphasizing that importers must declare the processed value of the item, not just the estimated raw material content. Despite that, some companies try to minimize declared steel or aluminum value to cut their tariff bill.

Now President Trump has significantly reset the Section 232 bar. As of April 6, 2026, goods made almost entirely of those metals, such as steel coils or aluminum sheets, are subject to a 50% tariff on the full value of the product. Since 2024, steel, aluminum, copper and nickel and derivative products have also been included under Section 232 with a 200% tariff when sourced from Russia, due to sanctions imposed in the wake of the Ukraine war.

Certain items “substantially made” of those metals will be hit with a 25% tariff, down from 50% previously. That initially sounds like a solid win for importers. But now, the tariff is assessed on the full value, not just the value of the component metals, which often results in a higher overall levy.

Under the new Section 232 rules, certain metal-intensive industrial and electrical grid equipment are subject to a 15% tariff, while products made abroad but with American-sourced metal face a 10% levy. Products with metal content of 15% or less by weight are exempt.

The administration also ended the formal process for adding new derivative products to the tariff list. Instead, the government will determine going forward whether additional derivative goods should be included.

For importers, the only safe path is to understand whether their product meets any formal tariff exemption criteria, and, if not, to budget for tariffs based on full value. This is an area where your customs broker or freight forwarder can help you understand the impact and how to mitigate the risk.

Commodity-Specific Tariffs: Furniture, Cabinets, and Dual-Use Codes

Newer tariffs often target specific product groups, such as upholstered furniture and kitchen or bathroom cabinets. Rates in these categories can be around 25%, with some reductions under preferential trade agreements, such as with UK-origin goods.

Implementation is HS-code-driven, which introduces complexity. Some HS codes clearly describe upholstered products or cabinets. Others are “dual-use” parts codes that can apply to both covered and non-covered items.

A generic “furniture parts” code might apply to components for upholstered or non-upholstered goods. If CBP assumes the parts are for upholstered furniture, the extra tariff applies. But if the parts are actually destined for non-upholstered items, that assumption is wrong, and costly.

This is where good documentation and proactive communication with your broker matter. Importers should:

• Clearly describe the product’s function and end use
• Provide supporting product information when needed
• Work with your customs broker or forwarder to ensure the HS code accurately reflects the specific product, not just the broadest possible category

The focus is on ensuring your product isn’t swept into a tariff bucket where it doesn’t actually belong.

Informational Materials: A Clear, Often-Missed Tariff Exemption

Some tariff exemptions are surprisingly generous but routinely overlooked. For example, informational materials such as books, prints, paintings, sculptures, and certain recorded media, are exempt from Section 122 tariffs.

I.C.E. Transport sees this frequently in the antiques trade. Containers arriving from the UK might contain general antiques, antique furniture, silverware, paintings and sculptures, and books, prints, and other media. A broker focused on speed might classify the entire load under a general “antiques” code, which is defensible but not optimal. That approach often subjects everything to the 10% Section 122 tariff.

A more diligent broker dissects the shipment. Antique furniture, silverware, and general items are listed under their proper HS codes. But qualifying paintings, books, prints, sculptures, CDs, DVDs, and similar items go under informational-material codes, which are exempt from certain tariffs.

“We take the time to break it out,” Rozek said. “If we see paintings or books or prints listed in a container’s bill of lading, we'll break that out and call it what it is, informational materials, so the importer is not paying the tariff on those items.”

The difference is not academic. In today’s environment, carving out exempt informational materials can represent significant savings, especially on high-value art or collections.

Contracts, Incoterms, and Who Really Bears the Cost

Even when you can’t avoid tariffs, you can still manage who pays them and how exposure is shared over time.

“Ultimately it all comes down to the Incoterms,” Rozek said. “Under DDP (Delivered Duty Paid), for example, the seller is on the hook for duties and tariffs, while the buyer receives the goods cleared and delivered. When tariffs rise mid-contract and there’s no re-opener clause, the seller’s margin erodes quickly.”

By contrast, under EXW, FOB, or similar terms, more of that risk sits with the buyer. Large retailers with leverage often push for long-term fixed pricing, shifting volatility to suppliers. Smaller buyers and sellers may stick to shorter terms or per-order pricing.

Tariffs and tariff exemptions should factor into commercial negotiations, not just compliance discussions. Depending on when your contracts were agreed, it may be time to revisit them.

No Loopholes, Just Detailed, Honest Work

Managing tariff exposure today is all about consistent, disciplined fundamentals. There are no shortcuts that can replace careful, detailed execution. Recent developments haven’t created new loopholes or made it easier to sidestep tariffs.

You as an importer can’t control tariff policy, but you can control how rigorously the government applies the existing rules in your favor. There is still a financial payoff in doing the hard, detailed work:

• Scrutinizing HS codes at the line-item level
• Understanding where genuine tariff exemptions still apply
• Aligning sourcing and routing with the evolving tariff map
• Making sure your customs broker is working for your interest, not just their own convenience

Tariff Exemptions: Are You Leaving Money on the Table?

In a world where tariffs can add 25%-60% to your costs, ignoring potential tariff exemptions is a missed opportunity.

I.C.E. Transport works with importers to review classifications for potential overpayment risks, distinguish genuinely exempt items from broader categories, understand how commodity- and country‑specific rules apply in practice, and track frequent changes to programs like Sections 122, 232, and 301.

If you suspect you may be overpaying, or that your classifications haven’t been revisited in years, it may be time for a fresh look. I.C.E. Transport, through our brokerage services, can support that review by highlighting logistics patterns, tariff exposure, and potential exemption opportunities. Contact I.C.E. Transport today to learn more.