Section 301 Tariffs
Section 301 tariffs are additional duties on goods of Chinese origin imposed under Section 301 of the Trade Act of 1974. Applied through Chapter 99 overlay codes on top of the base HTS classification, they range from 7.5% to 100%+ across product categories and represent one of the largest drivers of total landed duty cost for U.S. importers sourcing from China.
In Detail
The Section 301 tariffs were first imposed in 2018 following a USTR investigation into China's trade practices — including intellectual property theft, forced technology transfer, and other trade-distorting policies. The tariffs were implemented in four tranches covering different HTS subheadings at different rates: List 1 and 2 goods at 25%, List 3 goods initially at 10% and later increased to 25%, and List 4A goods at 7.5%. The tariffs are country-of-origin based — goods of Chinese origin are subject to Section 301 regardless of the country from which they are exported to the United States.
Since 2018, Section 301 rates have continued to evolve. Following statutory four-year reviews, the USTR announced significant rate increases in 2024–2025 on targeted categories including solar cells, electric vehicles, lithium-ion batteries, steel and aluminum derivatives, ship-to-shore cranes, and certain medical products — with rates reaching as high as 100% on some items. These rate increases are implemented through additional Chapter 99 provisions that layer on top of the existing list-based tariffs.
The USTR has administered product exclusion programs since 2018, granting temporary exemptions from Section 301 tariffs for specific products where no domestic alternative exists. Exclusions are identified by specific 10-digit HTS codes or detailed product descriptions, are time-limited, and must be renewed to remain in effect. Identifying whether a valid USTR exclusion applies is a required step in the Section 301 analysis for every affected product.
Classification Significance
Section 301 evaluation is a mandatory component of the complete HTS classification process for any product potentially of Chinese origin. The base HTS code determines which Section 301 list applies; the declared country of origin determines whether the tariff is owed; the full 10-digit HTS code and any USTR exclusion codes determine the net duty liability. Missing any element of this analysis — the applicable list, the correct origin, or an active exclusion — produces duty calculation errors with direct audit exposure.
How Kanon Handles This
Kanon evaluates Section 301 applicability as Layer 2 of its two-layer classification architecture. For every base HTS code, the applicable Section 301 list and rate are identified, current USTR exclusions are checked, and the complete Section 301 analysis is documented in the Classification Support Package alongside the base HTS determination.