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On June 3, 2025, President Trump issued a Proclamation (“the Proclamation”) increasing the Section 232 duties on imports of aluminum and steel from 25% to 50%. The Proclamation states that the previously imposed steel and aluminum tariffs “have not yet enabled these industries to develop and maintain the rates of capacity production utilization that are necessary for the industries’ sustained health and for projected national defense needs.” 

This change, made under Section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862) (“Section 232”) is set to take effect at 12:01 a.m. on June 4, 2025, and applies to all aluminum and steel articles, as well as derivative articles.

Notably, the Proclamation imposes these additional measures:

  • Duty Increase: As noted above, imports of aluminum and steel will be subject to 50% tariffs instead of the 25%.
    • Carveout for UK: Imports of United Kingdom (UK)-origin aluminum and steel articles and derivative articles will remain at 25% unless the Secretary determines that the UK has not complied with the U.S.-UK Economic Prosperity Deal (EPD) reached between the US and UK May 8, 2025.
  • Tariff “stacking” adjustment: The hierarchy created by EO 14289 is now modified such that Section 232 steel and/or aluminum tariffs apply before IEEPA Fentanyl tariffs on Canada and/or Mexico. For reference, see our separate blog post here discussing the various tariffs applied to an article and initial guidance for when that article is subject to more than one of the tariff actions identified in Executive Order (“EO”) 14289 (90 FR 18907) of May 1, 2025. The new hierarchy is explained in further detail below.
  • Reciprocal Tariffs: While previously US Customs and Border Protection (“CBP”) stated that only aluminum and steel derivative articles with zero percent aluminum and steel content would be subject to reciprocal tariffs, the new changes reflect that all aluminum and steel derivative articles will be subject to reciprocal tariffs. The reciprocal tariffs will only be due on the value of any non-steel/non-aluminum content.

Following the Proclamation, CBP) issued guidance via the Cargo Systems Messaging Service (“CSMS”) for determining duty rates based on the value of aluminum content (CSMS # 65236645), steel content (CSMS # 65236374), and on the modified tariff stacking regime (CSMS # 65236574). The CSMS concerning aluminum content provides the following:

  • Aluminum content: The applicable duty rates will apply to the value of the aluminum content within the article. Further, if the aluminum was smelted and cast in the United States, the duty rates imposed in this order will not apply.
  • Reporting: For new aluminum derivatives outside of Chapter 76 subject to Section 232 aluminum duties, and all aluminum and aluminum derivative articles classified in Chapter 76 subject to Section 232 duties, the 50 percent duty (25 percent duty for products of the UK), filers are to report the Chapter 99 classification based upon the value of the aluminum content.
  • Additionally, filers must report the duty on one entry summary line if the value of the aluminum content is the same as the entered value or is unknown.
  • Where the value of the aluminum content is less than the total entered value of the imported article, the good must be reported on two lines, with the first indicating the non-aluminum content and the second line representing the aluminum content.
  • Steel content: The applicable duty rates will apply to the value of the steel content within the article. Further, if the steel was melted and poured in the United States, the duty rates imposed in this order will not apply.
  • Reporting: For new steel derivatives outside of Chapter 73 subject to Section 232 steel duties, and all steel and steel derivative articles classified in Chapter 73 subject to Section 232 duties, the 50 percent duty (25 percent duty for products of the UK) is to be reported with the Chapter 99 classification based upon the value of the steel content.
  • Additionally, filers must report the duty on one entry summary line if the value of the steel content is the same as the entered value or is unknown.
  • Where the value of the steel content is less than the total entered value of the imported article, the good must be reported on two lines, with the first indicating the non-steel content and the second line representing the steel content.
  • Russia: The 200 percent duty on any aluminum products and derivative aluminum products subject to Section 232 that are products of Russia will remain in place.
  • Duty Drawback: The guidance notates that drawback remains unavailable with respect to the duties imposed.
  • Exclusions: Importer-specific product exclusions for Section 232 duties that are active will remain effective until their expiration date or until excluded product volume is imported, whichever occurs first. 
  • Foreign Trade Zone (FTZ): As previously required, all newly admitted steel and aluminum articles must be admitted in privileged foreign status.

UPDATED PRIORITIZATION GUIDANCE

The CSMS concerning tariff stacking sets forth a new priority order for the five presidential actions identified in EO 14289, as amended:

  • First, filers should determine if an article is subject to the 232 Auto/Auto Parts tariff. If so, then the article is not subject to the 232 Aluminum, 232 Steel, IEEPA Canada, or IEEPA Mexico tariffs.
  • CBP notes that parts of passenger vehicles and light trucks that qualify for preferential treatment under the United States-Mexico-Canada Agreement (USMCA), are not subject to the 232 Auto/Auto Parts, the IEEPA Canada, or the IEEPA Mexico tariffs. 
  • Second, (if the article is not subject to the 232 Auto/Auto Parts tariff), filers should determine if an article is subject to the 232 Aluminum and/or 232 Steel tariff. For derivative products subject to both the 232 Aluminum and 232 Steel tariffs, duties will be owed on both the value of the aluminum and steel content of that product. If the article is subject to the 232 Aluminum and/or 232 Steel tariffs, , then the article is not subject to the IEEPA Canada or IEEPA Mexico tariffs. 
  • CBP notes that aluminum and aluminum derivative products from Russia, and imports of such aluminum products from any country containing aluminum smelt or cast in Russia, ARE subject to the corresponding Section 232 duty rate of 200 percent.
  • CBP further notes that articles that qualify for preferential tariff treatment under USMCA, are not subject to the IEEPA Canada or IEEPA Mexico tariffs. 

Importantly, goods subject to these tariffs are still subject to other applicable duties, taxes, fees, exactions, and charges, such as, but not limited to, those set forth in column 1 or 2 of the Harmonized Tariff Schedule of the United States (HTSUS); duties imposed pursuant to Section 301 of the Trade Act of 1974, as amended; duties imposed pursuant to EO 14195, “Imposing Duties To Address the Synthetic Opioid Supply Chain in the People’s Republic of China” (see also CSMS # 65201384), as amended, and antidumping and countervailing duties.

EFFECTIVE DATE

EO 14289, as amended, applies retroactively to entries of merchandise subject to the five applicable tariff measures and entered for consumption or withdrawn from warehouse for consumption on or after March 4, 2025. However, CBP clarified that the modified tariff stacking outlined in this message applies to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on June 4, 2025.