27/07/2026
If you are importing goods into the US, then you will probably have noticed that – since 24 July - the new Section 301 duties are not being added the same way for every country.
Depending on your product's origin, the tariff is applied using one of two distinct methods. Here is a very simple breakdown of how they work and why:
The "Extra Stack" (Additional Ad Valorem Rate)
• What it is: A flat, extra tax stacked directly on top of your standard duty rate.
• How it works: If your item has a normal 5% duty and a 10% Section 301 rate, your total duty paid to Customs becomes 15%.
• Who gets it: This additive method applies to most of the 60 investigated economies, including the UK, China, India, Mexico, and Canada.
The "Top-Up" (Combined Column 1 Rate)
• What it is: Think of this as a minimum "duty floor" rather than an extra tax.
• How it works: Section 301 only tops up your existing duty to reach the target percentage. For example, if the target combined rate is 10%:
- Normal duty = 3%? Section 301 adds 7% (Total = 10%).
- Normal duty = 12%? Section 301 adds 0% because you already cleared the floor (Total = 12%).
• Who gets it: This applies to select trade partners like the EU, Japan, South Korea, Switzerland, and Taiwan.
Why the difference?
The USA Trade Representative (USTR) structures it this way to account for existing Most-Favoured-Nation (MFN) rates.
The Top-Up method ensures products from certain economies hit a strict minimum tariff level without unfairly double-penalising items that are already heavily taxed upon import. Meanwhile, the Extra Stack method serves as a more direct, flat-rate penalty across the board for the remaining economies, regardless of what their standard tariffs are.
Click the link below to see the countries affected and how the different methods may affect the additional duty on your sales to the USA (Correct as of 24 July 2026).
https://www.ocsworldwide.co.uk/wp-content/uploads/2026/07/OCS-USA-Import-Duty-Rate-Lists.pdf
We can help you understand Section 301 duty and how shipping into the USA can remain one of your growth areas. Reach out to the team for a frank and clear view of import tax, regardless of which countries you ship to.