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On April 29, 2025, President Donald Trump issued an <a href="https://www.whitehouse.gov/presidential-actions/2025/04/addressing-certain-tariffs-on-imported-articles/">Executive Order (EO)</a> clarifying that each of the tariffs he has imposed pursuant to the International Emergency Economic Powers Act (IEEPA) and Section 232 of the Trade Expansion Act&nbsp;of 1962, serve separate and distinct policy purposes, but should &ldquo;not all have a cumulative effect (or &lsquo;stack&rsquo; on top of one another)&rdquo; to the extent that they apply to the same imported article.&nbsp; Stating that the rate of duty resulting from stacking &ldquo;exceeds what is necessary to achieve the intended policy goals,&rdquo;&nbsp;the EO sets out the procedure for determining which tariffs will apply to an article when that article is subject to more than one tariff action.
The EO addresses the following tariffs:
<ul class="wp-block-list">
<li>the 25% Section 232 tariffs on imports of automobiles and certain auto parts into the United States;</li>
<li>the 25% IEEPA tariffs on Canada and Mexico to address the flow of synthetic opioids/fentanyl into the United States;</li>
<li>the 25% Section 232 tariffs on imports of steel articles into the United States; and</li>
<li>the 25% Section 232 tariffs on imports of aluminum articles into the United States.</li>
</ul>
The EO states that:
<ul class="wp-block-list">
<li>Items subject to the Section 232 automobile and auto part tariffs, will not be subject to the other listed tariffs.&nbsp;</li>
<li>Items subject to the IEEPA tariffs on Canada or Mexico will not be subject to the Section 232 tariffs on imports of aluminum or steel articles.</li>
<li>Items subject to the aluminum or steel tariffs may be subject to both aluminum and steel tariffs if the article satisfies all conditions necessary for application of those additional tariffs.&nbsp;</li>
</ul>
The action provides relief to companies that faced the potential stacking of the automotive/auto parts tariffs, the Canada and Mexico synthetic opioid/fentanyl tariffs, and the steel and aluminum tariffs.&nbsp; The steel and aluminum tariffs will continue to stack with each other, but not with the automotive/auto parts tariffs and the Canada and Mexico synthetic opioid/fentanyl tariffs.&nbsp; As between these four classes of tariffs, there is an open question as to whether the &ldquo;subject to tariffs&rdquo; language in Section 3 of the EO means tariffs as applied prior to any exemption such as the United States Mexico Canada Agreement (USMCA) exemption provided in the Canada and Mexico synthetic opioid/fentanyl tariffs.&nbsp; Specifically, articles of Canada and Mexico are subject to IEEPA tariffs, but are exempt from such tariffs if the articles may be USMCA certified (see <a href="https://www.thompsonhinesmartrade.com/2025/03/the-united-states-delays-implementation-of-ieepa-tariffs-against-canada-and-mexico-for-usmca-qualifying-goods-until-april-2-2025/">Update of March 6, 2025</a>).&nbsp; As those articles would have a no duty pursuant to IEEPA, the question remain as to whether they would still be subject to duty under the 25% Section 232 automotive/auto parts tariffs or steel or aluminum tariffs, if applicable (see <a href="https://www.thompsonhinesmartrade.com/2025/03/trump-administration-imposes-section-232-steel-and-aluminum-25-tariffs-march-12-2025-eu-and-canada-retaliate/">Update of March 12, 2025</a> (25% Section 232 tariffs on steel and aluminum) and <a href="https://www.thompsonhinesmartrade.com/2025/03/president-trump-announces-section-232-tariffs-of-25-on-imports-of-automobiles-and-certain-auto-parts/">Update of March 27, 2025</a> (25% Section 232 tariffs on automotive/auto parts)).&nbsp; The spirit of the EO suggests that one of the tariffs would be paid by the importer of record&mdash;i.e., there is not a blanket exemption via USMCA.&nbsp; Guidance is required from the relevant agencies.
However, the EO clearly indicates that the synthetic opioid/fentanyl tariffs imposed against articles of China under IEEPA are still subject to stacking.&nbsp; Additionally, if an imported article is subject to both a tariff action listed above and one not listed, then the different tariffs will continue to be cumulative. However, articles subject to the above tariffs are expressly exempted from the 10% &ldquo;baseline&rdquo; reciprocal tariffs (see <a href="https://www.thompsonhinesmartrade.com/2025/04/president-trump-pauses-country-specific-reciprocal-tariffs-for-90-days-but-increases-tariffs-on-china/">Update of April 10, 2025</a>).&nbsp; In addition, an imported article that is subject to tariffs listed above &ldquo;may still be subject to other applicable duties, taxes, fees, exactions, and charges&rdquo; such as the Section 301 tariffs imposed against China during the first Trump Administration and continued under President Biden and any antidumping and countervailing duties (see <a href="https://www.thompsonhinesmartrade.com/2024/09/ustr-finalizes-action-on-china-section-301-tariffs-following-four-year-review/">Update of September 16, 2024</a>).&nbsp; Of key importance, the effect of this EO is retroactive for all entries of articles made on or after March 4, 2025, and importers may request refunds.
It is expected that Customs and Border Patrol (CBP) will be issuing clarifying information and guidance shortly via its Cargo Systems Messaging Service (CSMS).

President Trump Issues Clarification on Application of Various IEEPA Tariffs

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