Section 122 Temporary Import Surcharge: What Importers Need to Know
Effective February 24, 2026, a 10% temporary import surcharge under Section 122 of the Trade Act of 1974 applies to nearly all imported goods. This guide covers scope, exemptions, and compliance requirements for affected importers.
On February 14, 2026, President Biden invoked Section 122 of the Trade Act of 1974 to impose a temporary 10% import surcharge on substantially all goods entering the United States, effective February 24, 2026. Section 122 authorizes the President to impose temporary surcharges of up to 15% for a period of 150 days when the nation faces large and serious balance-of-payments deficits. The proclamation cites the U.S. current account deficit, which exceeded $900 billion in 2025, as the triggering condition.
Unlike IEEPA-based tariffs, Section 122 has a clear statutory basis that has survived prior legal challenges. The surcharge applies on top of existing duties — meaning a product already subject to a 25% Section 301 tariff would now face a combined rate of 35%. The surcharge is assessed on the customs value of imported goods and is collected by U.S. Customs and Border Protection at the time of entry.
Key exemptions include goods covered by free trade agreements (USMCA, CAFTA-DR, and bilateral FTAs with Australia, South Korea, and others), products already subject to Section 232 tariffs on steel and aluminum, and certain humanitarian goods including pharmaceuticals and medical devices classified under specific HTS chapters. Importers should carefully review their product classifications to determine whether exemptions apply.
From a compliance standpoint, importers must update their customs entry procedures immediately. Customs brokers have been instructed to apply the surcharge as an additional duty line on entry summaries. Importers using automated broker interfaces (ABI) should verify that their systems have been updated to handle the new surcharge code. Failure to declare and pay the surcharge will result in liquidated damages and potential penalties under 19 USC § 1592.
The 150-day statutory limit means the surcharge is set to expire on July 24, 2026, unless renewed through separate legislative action. Importers should factor this sunset date into their procurement and pricing strategies. For companies with long lead times, goods ordered now but arriving after July 24 may not be subject to the surcharge — but this depends on the date of entry, not the date of purchase order.
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