Section 122 Expired on July 24 — Here's the Tariff That Replaced It
The flat 10% surcharge ran out after its 150-day limit. The same minute, a forced-labor Section 301 tariff took effect on 60 economies — 10% or 12.5% depending on where your goods come from. For China, Vietnam and Thailand the new rate is higher than the old one.
What happened, in order
- 20 February 2026 — the Supreme Court ruled that IEEPA does not authorise tariffs, ending the 2025 "reciprocal" and fentanyl tariffs (145% at their peak on China).
- 24 February 2026 — a flat 10% surcharge under Section 122 of the Trade Act of 1974 replaced them, limited by statute to 150 days.
- 7 May 2026 — the Court of International Trade ruled the surcharge unlawful for three plaintiff importers; the Federal Circuit stayed that ruling on appeal.
- 24 July 2026, 12:01 a.m. — Section 122 expired. USTR's forced-labor Section 301 duties on 60 economies started the same minute.
- 3 August 2026 — 25 state attorneys general challenged the forced-labor tariff in the Court of International Trade. CBP is collecting it meanwhile.
What each country pays now
The forced-labor tariff's four tiers, covering 60 economies.
Argentina, Bangladesh, Cambodia, Canada*, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico*, Pakistan, Sri Lanka, Trinidad and Tobago, United Kingdom
European Union (all 27 member states), Taiwan — the addition is 10% minus the product's MFN rate, never below zero
Japan, South Korea, Switzerland — the addition is 12.5% minus the product's MFN rate, never below zero
Algeria, Angola, Australia, Bahamas, Bahrain, Brazil, Chile, China, Colombia, Costa Rica, Dominican Republic, Egypt, Guyana, Hong Kong, Iraq, Israel, Kazakhstan, Kuwait, Libya, Morocco, New Zealand, Nicaragua, Nigeria, Norway, Oman, Peru, Philippines, Qatar, Russia, Saudi Arabia, Singapore, South Africa, Thailand, Türkiye, United Arab Emirates, Uruguay, Venezuela, Vietnam
* USMCA-qualifying goods from Canada and Mexico are exempt; non-qualifying goods pay 10%. Section 232 goods, enumerated pharmaceuticals, civil aircraft, CAFTA-DR and US–Jordan FTA textiles, and about 860 Annex II tariff lines are exempt. Any economy not listed pays nothing.
Before and after, per shipment
| Shipment | Duty under §122 | Duty now | Change |
|---|---|---|---|
| $10,000 headphones, China (8518.30.20) | $1,000 | $1,250 | +$250 |
| $50,000 sneakers, China (6404.11) | $18,750 | $20,000 | +$1,250 |
| $50,000 sneakers, Vietnam (6404.11) | $15,000 | $16,250 | +$1,250 |
| $50,000 T-shirts, India (6109.10) | $13,250 | $13,250 | $0 |
| $100,000 furniture, Vietnam (9403.60) | $10,000 | $12,500 | +$2,500 |
| $100,000 machine parts, Germany (8483.10, 2.5% MFN) | $12,500 | $10,000 | −$2,500 |
| $20,000 goods, Georgia (5% MFN) | $3,000 | $1,000 | −$2,000 |
| $25,000 steel bolts, Germany (§232) | exempt | exempt | $0 |
Duty only — MFN + China Section 301 + the §122 surcharge or the forced-labor tariff, on the FOB value, before MPF, HMF and freight. Run your exact HS code in the calculator for the full stack.
What to watch next
The court challenge
25 states are asking the Court of International Trade to block the forced-labor tariff and order refunds. A ruling like the May 2026 Section 122 decision could again apply only to the plaintiffs at first.
Annex changes
USTR can add or remove product exemptions by notice. About 860 tariff lines are already fully exempt — check your 8-digit HTS code, not just your country, in the free forced-labor tariff checker.
Country deals
The EU, Japan, Korea and Switzerland already have floor-style rates. Further trade agreements can move an economy between tiers with little notice.
Section 122 and the forced-labor tariff — FAQs
Yes. Section 122 of the Trade Act of 1974 allows an import surcharge for at most 150 days unless Congress extends it. The 10% surcharge imposed on 24 February 2026 — after the Supreme Court struck down the IEEPA tariffs — ran out at 12:01 a.m. on 24 July 2026. Congress did not extend it.
The same minute, USTR's final action in 60 forced-labor investigations under Section 301 took effect: an additional 10% or 12.5% duty on goods from 60 economies. Unlike Section 122 it is not flat — the rate depends on the country of origin, and for the EU, Taiwan, Japan, South Korea and Switzerland it is a combined rate that includes the MFN duty.
17 economies pay 10% on top of MFN, including India, Indonesia, Malaysia, Sri Lanka, Bangladesh, Pakistan, Cambodia, the UK, Canada and Mexico. The EU and Taiwan pay a combined 10% including MFN; Japan, South Korea and Switzerland a combined 12.5%. The other 38 — including China, Vietnam, Thailand, the Philippines, Türkiye, Brazil and Australia — pay 12.5% on top of MFN. Countries outside the 60, such as Georgia, Armenia or Uzbekistan, pay nothing extra.
For these origins the forced-labor duty tops the product up to a floor. A German machine part with 2.5% MFN pays an extra 7.5% (10% total). A Japanese product with 2.5% MFN pays an extra 10% (12.5% total). If the MFN rate is already at or above the floor, nothing extra is due.
Yes. Chinese goods pay MFN + their Section 301 list rate (25% on Lists 1–3, 7.5% on List 4A, 0% on the suspended List 4B, up to 100% for a few products) + 12.5%. Cotton T-shirts from China: 16.5% + 7.5% + 12.5% = 36.5%.
USMCA-qualifying goods from Canada and Mexico; any product covered by a Section 232 tariff (steel, aluminum, copper, autos and parts, trucks, some wood products); enumerated pharmaceuticals; civil aircraft; CAFTA-DR and US–Jordan FTA textiles; and about 860 tariff lines listed in Annex II of USTR's notice.
Yes. On 3 August 2026, 25 state attorneys general sued in the Court of International Trade. CBP is collecting the duty while the case runs, so it belongs in every landed cost calculation today.
Not automatically. On 7 May 2026 the Court of International Trade ruled the Section 122 surcharge unlawful, but relief covered only the three plaintiff importers, and the Federal Circuit stayed the ruling on appeal. If the appeal courts invalidate the surcharge, a CBP refund process is plausible but not assured. Keep your entry summaries (CBP Form 7501) so you can claim if refunds open.
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