Supreme Court Kills IEEPA Tariffs; US Imposes 10% Global Import Surcharge Under Section 122
After the Supreme Court struck down all IEEPA-based tariffs on February 20, 2026, the Trump administration immediately invoked Section 122 of the Trade Act of 1974, imposing a 10% global import surcharge effective February 24. The surcharge expires July 24, 2026 unless Congress extends it. For FBA sellers importing from China, the new duty stacks on top of existing Section 301 rates, pushing effective tariff rates above 50% on many product categories. Amazon has responded by pressuring suppliers for 20–30% discounts, while sellers must urgently reprice or locate domestic alternatives before margins collapse.
Real-World Impact
A product imported from China at $10 landed cost previously faced ~25% Section 301 duties ($2.50). The new 10% Section 122 surcharge adds roughly $1.25 more (applied to the post-duty value), pushing landed cost to ~$13.75 — a 37.5% jump vs. pre-tariff era, before accounting for any China-specific additional duties.
Key Points
- 10% global import surcharge effective February 24, 2026 — replaces IEEPA tariffs struck down by the Supreme Court on February 20
- Expires July 24, 2026 (150-day statutory limit under Section 122); Congress would need to act to extend it
- De minimis $800 duty-free threshold remains suspended — every commercial import now requires formal customs processing
- China-sourced FBA inventory faces stacked duties: base tariff + Section 301 (25%+) + Section 122 (10%) — total effective rates can exceed 50%
- Import duties are non-refundable even when FBA items are returned by customers — high-return categories face compounded losses
- Amazon is demanding 20–30% supplier price concessions across vendor and private-label programs to offset tariff costs
What You Should Do Now
- 1Run a full landed-cost audit for every imported FBA SKU — use your actual HTS codes to calculate stacked duty rates (base + 301 + 122)
- 2Reprice affected products immediately if current selling prices no longer support margins after updated landed costs
- 3Negotiate with overseas suppliers — use Amazon's own 20–30% discount demands as market leverage in your negotiations
- 4Evaluate domestic or near-shore sourcing alternatives for your highest-volume SKUs where duty stacking is most punishing
- 5Consult a licensed customs broker to verify HTS classifications and actual effective duty rates for your product categories
- 6Monitor Congressional activity and prepare pricing scenarios for both the July 24 expiration and a potential Congressional extension