Overview
President Trump has announced extensive new tariffs under his Liberation Day initiative on April 2, 2025.
We know navigating the complexities of international trade policy can be a daunting task, especially when tariffs and geopolitical strategies intersect. This article aims to demystify the situation and provide clarity, compiling a list of frequently asked questions. As more details unfold, we'll update this document real-time to provide accessible & relevant information.
Let's explore the key aspects of these tariffs and their potential implications. Please feel free to add questions in the comment section to be included in this articles FAQ. Remember, be civil & keep an open minded, bi-partisan tone!
FAQ
Q: What are tariffs?
A: Tariffs, in the context of international trade, are essentially taxes imposed by a government on goods and services imported from other countries. Governments implement tariffs for several reasons, including protecting domestic industries by making domestically produced goods more competitive, generating revenue for the government, addressing trade imbalances by reducing trade deficits, and as a political tool to pressure other countries in trade negotiations.
There are different types of tariffs, such as ad valorem tariffs, which are calculated as a percentage of the imported good's value, and specific tariffs, which are a fixed amount per unit of the imported good. In essence, tariffs are a governmental instrument used to influence international trade, with potential consequences for both domestic and foreign economies.
Q: What are the tariffs being implemented with the Liberation Day Initiative?
A: The executive order outlining the reciprocal tariff plan is expected to be released later on Wednesday. The president indicated that aside from the reciprocal tariffs, the administration will establish a minimum baseline tariff of 10%.
During the President's Rose Garden remarks, Trump held up a poster board showing what it said were the combined rate of tariffs, other non-tariff barriers and currency manipulation by trading partners on U.S. goods, alongside the reciprocal tariffs the Trump administration plans to levy on imports from those countries. The administration later revealed the calculation included the U.S. trade deficit with those countries. Among those included were:
May 2025 Update: The Administration has communicated that the total tariff amount will be decreased to 10% for all countries except for Canada, Mexico, & China. China as of May 12th will have an additive tariff of 30% as negotiations continue.
Q: What's the total tariffs? Is the values above additive to previous tariff announcements & implementations? (ie. 2018 Tariffs + Jan Tariff Announcement + Feb Tariff Announcement + Liberation Day Tariff Announcement)?
A: At this moment, it's unclear. But it is likely that these tariffs are additive. When we have clear information on this topic, we'll be sure to post the information here.
May 2025 Update: As of May 12, 2025, the Administration has communicated that the total tariff amount of 145% previously announced will decrease to 30%. Below is a helpful infographic outlining the tariff changes:
*Source: https://www.nytimes.com/2025/05/12/business/china-us-tariffs.html
Q: How are tariffs calculated?
A: Portless is working in tandem with our Trade Brokers & Freight Forwarders to ensure that all appropriate tariffs are calculated with all necessary information. Tariffs are calculated based on a percentage duties rate as informed by your product's HS Codes and applied on your Transaction Value (with Portless this would be your Cost of Goods).
To ensure that the accurate duties are calculated, please ensure that your Cost Per Item & HS Codes fields on your Shopify Product pages (for all products shipped by Portless) are up-to-date. We'll leverage this data with Portless's, our Carrier Network, & Trade Brokerage database to calculate the accurate duties owed on packages submitted to customs via Entry Type 11.
See below for a formula & example:
Formula
% Tariff based on HS Code * sum(Cost of Goods in Order)
Example
% Tariff = 200% based on designated HS Code*
Cost of Goods = $5.00
Number of products in order = 2 (same SKU)
200%*(2*$5.00) = $20
*Note: HTS website has not been updated with Trump Tariffs as of yet (4.16.2025)
Q: What is the application logic of 30% or $25 duties on China imports?
A: The $25 duties conditional does not apply to Portless's direct supply chain model. The $25 conditional duties application is only specific for International Postal Mail/Letter-mail from China. Don't worry, we've confirmed this with our lawyers.
Q: Is the de minimis from China gone? Will de minimis for Vietnam & other countries be impacted now or in the long-term?
A: As of now, only China, Hong Kong, & Macau have had de minimis repealed as of May 2nd. For other countries like Vietnam, there's no indication that the de minimis will be removed. In the short-term, there is an opportunity to take advantage of the still existing de minimis structure with Vietnam & other countries; although the landscape is changing quickly & it's unclear how long this will continue.
Q: What does it mean with my business at Portless? Will it be more expensive through Portless or through traditional bulk importing?
A: Portless is still the best model of fulfillment for importing goods internationally to the United States. President Trump's tariff application is global, meaning that all countries and methods of importing will be subject to these new tariffs (except countries that still have access to US de minimis).
What Portless brings to the table that continues to provide benefits above & beyond bulk import is:
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- Duties Deferment - The Portless model relies on a parcel-by-parcel injection method through Customs based on goods sold. Duties & all relevant taxes are paid upon import through US Customs & Border Patrol for these goods. Unlike bulk/freight importing, these orders are already sold and duties/taxes are paid on the individual item rather than the bulk of the goods imported. This provides tremendous benefits to your cash flow & accessibility as tariffs on bulk imports will eat up available funds for unsold goods.
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Precise Inventory & Lean Production - In order to maximize the cost of bulk/freight shipping, businesses will need to produce multiple months/years of stock to warehouse within the United States. That often means overproduction & unsold goods will continue to pile up in the traditional bulk/freight fulfillment method. With Portless, you can continue to take advantage of cost effective imports while maintaining a fast & agile production schedule for your business, opening up capital for new product production, marketing, & investments back in to your customers.
Q: Will it be bumpy during the May 2nd transition to the new Liberation Day Tariffs?
A: Potentially.
Portless is already prepared with Entry Type 11 to handle all import requirements for your parcels & we expect no delays with our fulfillment from our warehouses & our first mile carrier network. However, there is a high probably that ALL cargo--both parcel packages or en-bulk--will be impacted with CBP & last mile congestion.
We recommend potentially looking into reducing ad spend & proactively setting customer expectations during the first week of May 2025.
Long-term, we expect that the new tariff requirements for documentation & information will actually help streamlines & improve the overall process of imports to the United States. Entry Type 11 and all additional technical implementations of proper import declaration will remove back actors from the scene which potentially caused the most impacts to CBP clearance timeframes.
May 2025 Update: As of May 2nd, the transition to Entry Type 11 has gone smoothly. We do not see any spikes of customs holds or additional delays when inspections occur. Typical delivery time to the United States is +1 to +2 days for the cohort of packages from April 27th - May 10th. All packages delivery times to the United States are returning to normal.