Tariff update for manufacturers: What’s the state of tariffs in mid-2026?

Cara Walton

Aug 18, 2026

7 min read

Key takeaways

The Trump administration has imposed new Section 301 tariffs on most U.S. trading partners at 10-12.5% to replace its previous 10% Section 122 tariffs, which recently ended.
Additional Section 301 tariffs and new Section 232 tariffs are expected to follow, while older Section 232 tariffs remain in effect at 10-50% for certain goods like aluminum.
Manufacturers should also prepare for changes to the USMCA trade agreement, which is up for renegotiation, and potential Section 338 tariffs on specific Canadian imports.

For the past year and a half, tariffs have roiled supply chains and forced manufacturers to adjust their business models. But tariff rules are changing: Section 122 tariffs recently ended, but have been replaced by Section 301 tariffs, while Section 232 tariffs also remain in effect.

What are the key tariff rules you should know, and how should your business adapt to navigate new tariff changes? Keep reading to learn more.

Section 122 tariffs have now ended

Section 122, which was a global 10% tariff, has ended as of July 24. These tariffs were imposed by the Trump administration after the Supreme Court ruled the administration’s earlier IEEPA tariffs were illegal.

The Trump administration used Section 122 tariffs as a temporary, 150-day bridge to keep tariffs in place while it worked to implement more permanent tariffs under Section 301 (which have now taken effect).

Several lawsuits are challenging the legality of the Section 122 tariffs. Should Section 122 tariffs eventually be ruled illegal, businesses could be eligible for refunds on tariff fees.
However, until a court rules on Section 122, there is no current pathway for refunds available (which is not the case for the overturned IEEPA tariffs).

New Section 301 tariffs have replaced Section 122

Section 122 tariffs have now been replaced by Section 301 tariffs at a current rate of 10-12.5%. The U.S. government can impose Section 301 tariffs in response to unfair trading practices, as identified during an investigation by the Office of the United States Trade Representative (USTR).

Section 301 allows the administration to put tariffs in place indefinitely and at any chosen tariff rate.
The Court of International Trade (CIT) has ruled that Section 301 tariffs are legal.
The statute gives the U.S. Trade Representative (USTR) authority to take action that is “appropriate and feasible,” which is the mechanism being used to implement different tariff rates.
Section 301 tariffs apply to specific countries (or economies in the case of the European Union) that have been investigated and found guilty of one or multiple of these investigations conducted by USTR.

Current Section 301 tariffs fall under a forced labor investigation

The Section 301 tariff process involves the USTR conducting an investigation into specific trading practices it deems unfair. Currently, Section 301 tariffs are being imposed as part of a forced labor investigation.

This investigation has different tariff rates based on three separate tiers, which range from 10-12.5%. The three tiers are:

10%, not inclusive of MFN (most favored nation, which are also known as the general tariff rates)
10% or 12.5%, inclusive of MFN
12.5%, not inclusive of MFN

More Section 301 investigations are ongoing, with more tariffs expected soon

More tariffs could soon be imposed as a result of additional ongoing Section 301 tariff investigations. Active USTR investigations include industrial excess capacity, pharmaceutical pricing, U.S. tech discrimination, digital service taxes, ocean pollution and trade in seafood, rice and other products.

Expect to see a new Section 301 tariff emerge from the industrial excess capacity investigation soon.
The administration has also indicated that the excess capacity tariff may stack on top of the Section 301 forced labor tariff on countries the USTR has found guilty of both.

USMCA-compliant goods and anything tariffed under Section 232 are exempt from Section 301

The Section 301 forced labor tariff does exclude USMCA-compliant goods, as well as goods tariffed under Section 232. This means that Section 301 tariffs will not stack on top of Section 232 tariffs.

Section 232 also supersedes Section 301, so if you have a good that is on a Section 232 list, Section 301 would not apply. For example, a steel bar that is subject to the Section 232 steel tariff would not also have a Section 301 tariff applied.

Additional Section 301 exemptions may also apply

There are also several additional exemptions from the Section 301 tariffs. To avoid accidentally paying tariffs that you may be exempt from, you need to know:

The HTS code for each good you’re importing
Which tariff lists those HTS codes are included on
The country of origin to determine the tariff rate being paid

The administration has the right to make changes and change tariff rates, so once you know which list your goods are on, make sure you pay close attention to any announcements on changes to that list.

Additionally, depending on future trade deals that are ratified with the U.S., a country could move from one tier to another tier. For example, a country currently at 12.5% plus MFN could ratify a trade deal with the U.S. to move to a lower tariff rate of 10% inclusive of MFN, or to a different tariff rate entirely.

Section 232 tariffs remain active

Section 232 tariffs have also been upheld by the CIT and emerge from an investigation process similar to that used for Section 301 tariffs. Section 232 tariffs have been placed on products such as steel, aluminum, automobiles, lumber and more.

The tariffs under Section 232 range from 10%-50%, depending on the product.
There are additional Section 232 tariffs under investigation in the following categories: industrial machinery and robotics, semiconductors, pharmaceuticals, critical minerals, anthracite coal, commercial aircraft, polysilicon, unmanned aircraft systems, wind turbines and personal protective equipment.

Expect new Section 232 tariffs on industrial machinery and robotics

The administration has signaled it plans to announce two new Section 232 tariffs on industrial machinery and robotics. As of September 2, 2025, all countries were included in the investigations for these tariffs.

The investigations focused on potential national security threats related to imports of robotics and industrial machinery, including several different types of machining centers, equipment, and tool changers.

The government may incentivize machine builders to invest in the U.S., with Section 232 tariffs as a component of that domestic machine tool strategy.

USMCA negotiations are ongoing, with the U.S. seeking significant changes

Six years after the United States-Mexico-Canada Agreement (USMCA) entered into force, the agreement reached a critical milestone. July 1, 2026, marked the start of the required three-party review process among the United States, Canada and Mexico.

While Canada and Mexico have advocated for a 16-year extension of the agreement, the United States has pushed for continued periodic reviews and broader renegotiation discussions. Current expectations are that negotiations will continue throughout the remainder of 2026 and likely extend into 2027 before a final agreement is reached.

As part of these discussions, the United States is seeking significant changes to the USMCA rules of origin requirements, including a proposal that qualifying products contain at least 50% U.S. content. The administration is also emphasizing stronger North American supply chain sourcing and reducing reliance on Chinese-origin components.

Watch for new Section 338 tariffs on Canadian imports

Complicating the USMCA negotiations is the news that the administration may impose new Section 338 tariffs on Canada. Announced on July 20, 2026, the tariffs are scheduled to take effect on August 19, 2026, unless modified, suspended or withdrawn prior to implementation.

Section 338 of the Tariff Act of 1930 gives the President authority to impose tariffs in response to discriminatory actions against U.S. commerce.
The proposed measures would affect approximately $20 billion in Canadian shipments to the United States, representing roughly 5% of Canadian imports into the U.S.
The tariffs specifically target products in the alcohol, dairy and automotive sectors, with cheese identified as a key dairy product affected.

Notably, products that qualify for preferential treatment under USMCA would not be exempt from Section 338 measures, creating uncertainty for manufacturers and importers that have relied on USMCA to freely move goods throughout North America.

Next steps: Adapting your business to meet tariff challenges

Tariffs will continue to pose challenges for manufacturers for the foreseeable future. To adapt to this environment, you need to understand how tariffs impact your business, both in terms of your financial forecasts and your global supply chain.

The first step here is knowing the HTS codes for everything you import and then reviewing those codes frequently to understand the current tariff rates. This can give you a baseline financial awareness of your tariff costs.

You may also benefit from working with a third-party advisor to gain additional insight on how tariffs affect your operations, financials and markets. An advisor can also help you explore creative solutions to thrive even in this complex, fast-changing moment.

How Wipfli can help

We advise manufacturers on navigating tariffs and adapting to meet today’s business challenges. Let’s talk about how we can help you forecast tariff impacts, consider new sourcing options and find your place in the current global trade environment. Start a conversation.

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