US Import Tariffs Explained: Section 301, 232, and 201
US importers rarely pay a single tariff. Most industrial goods carry a base Most-Favored-Nation (MFN) rate from the Harmonized Tariff Schedule, and then one or more additional layers — Section 301, Section 232, or Section 201 — stack on top. Each layer comes from a different law, targets different things, and is calculated against the same customs value. This guide breaks down how the layers differ and how to model your true landed-duty exposure.
The base layer: MFN duty rates
Every imported product classified under an HTS code has a base "general" duty rate that applies to imports from World Trade Organization members. This MFN rate is the starting point — often low (0–5%) for machinery and components. The additional tariff layers below are all applied on top of this base rate, not instead of it.
Section 301: unfair trade practices
Section 301 of the Trade Act of 1974 lets the US Trade Representative impose duties in response to unfair foreign trade practices. In practice, the dominant Section 301 actions are the additional duties on goods imported from China — covering electrical equipment, machinery, instrumentation, fasteners, and thousands of other tariff lines. These duties are country-specific (primarily China) and typically range from 7.5% to 25% on top of the MFN rate.
Section 232: national security
Section 232 of the Trade Expansion Act of 1962 authorizes tariffs on imports that threaten national security. The headline Section 232 actions cover steel and aluminum and apply to most countries of origin, not just one. For projects that consume structural steel, piping, valves, and aluminum, Section 232 duties can shift a budget by millions depending on sourcing.
Section 201: safeguard tariffs
Section 201 of the Trade Act of 1974 authorizes temporary "safeguard" tariffs to protect a domestic industry from a surge of imports that causes serious injury — regardless of whether trade was unfair. The best-known Section 201 actions cover solar cells/modules and large residential washers. Like Section 232, they generally apply globally (with some country exclusions) and phase down over a set period.
The layers at a glance
| Layer | Legal basis | Trigger | Country scope |
|---|---|---|---|
| MFN | Harmonized Tariff Schedule | Standard import duty | WTO members |
| Section 301 | Trade Act of 1974 | Unfair trade practices | Country-specific (mainly China) |
| Section 232 | Trade Expansion Act of 1962 | National security | Most origins (steel & aluminum) |
| Section 201 | Trade Act of 1974 | Import surge / injury | Global safeguard |
Worked example: how the layers stack
Each layer applies to the same customs value, so they are additive. Consider a $1,000,000 order of Chinese-origin steel-bodied electrical switchgear subject to base MFN, a Section 301 China action, and Section 232 steel duty:
| Duty layer | Rate | Amount |
|---|---|---|
| Base MFN duty | 2.5% | $25,000 |
| Section 301 (China) | +25% | $250,000 |
| Section 232 (steel) | +25% | $250,000 |
| Total landed duty | 52.5% | $525,000 |
A single line item can more than double in delivered cost once the layers combine. Modeling each layer separately — by HTS code and country of origin — is the only reliable way to see which sourcing decisions actually move the budget.