Section 232 Applies to Full Value Starting Today, Section 338 in Play, CAPE Launches April 20, CBP Audit Collections Double
Section 232 Tariffs Now Apply to Full Product Value
The change that matters is this: Section 232 tariffs on steel, aluminum, and copper now apply to the full customs value of imported goods, not just the metal content. That goes live April 6th at 12:01 AM EDT.
For years you paid Section 232 on the value of the metal in the product. If you imported a $1,000 article with $300 worth of aluminum, you paid Section 232 on $300. Now you pay it on $1,000. The math just changed on thousands of HTS codes.
Articles made entirely or almost entirely of aluminum, steel, or copper face 50% on full value. Derivative articles substantially made of these metals face 25% on full value. Products with 15% or less metal content by weight are exempt.
Metal intensive industrial equipment and electrical grid equipment get a temporary 15% rate through December 31, 2027. Products made abroad but entirely from US origin metals qualify for 10%. UK origin products get reduced rates if the metal was smelted or cast in the UK.
The Secretary of Commerce and USTR can add derivative articles on a rolling basis when they determine imports threaten national security. The old inclusion process is dead. The new process is faster and less transparent. If you import products in Chapters 72, 73, 74, or 76, you need to determine which Annex applies to each product right now.
IEEPA Refunds Are Opt In and Phase 1 Launches April 20
CBP filed a status update with the Court of International Trade on March 31. CAPE could launch as soon as April 20. The most important thing to understand is that refunds are opt in. Nothing gets issued automatically. You have to come forward, submit entry data via CSV through the claim portal, and prove you paid IEEPA duties.
As of March 30, the Claim Portal is 85% complete. Mass Processing is 60% complete. Review and Liquidation is 80% complete. The Refund component is 75% complete. The mass processing engine that strips IEEPA HTS numbers and recalculates duties is the furthest behind and has the most runway left.
Phase 1 will process entries that are unliquidated or liquidated within the preceding 80 days. Phase 1 will also accept declarations for entries with a liquidation status of suspended, extended, or under review. CBP estimates Phase 1 will cover approximately 63% of entries for which IEEPA tariffs were paid.
Phase 1 does not cover entries flagged for reconciliation, entries designated on a drawback claim, entries covered by an open protest, entries not filed in ACE, and entries subject to AD/CVD duties pending liquidation. Finally liquidated entries are excluded. CBP will address these in a later phase with no confirmed timeline.
CBP will take up to 45 days from acceptance of a declaration to review and liquidate entry summaries unless there is a compliance concern. That means from the date you submit to the date you receive your refund could be 45 days or more.
Importers must be enrolled for electronic refunds through the ACE Secure Data Portal. As of March 26, importers filing 22% of entries subject to IEEPA tariffs had not completed this process. If you have not set up ACH refunds, do it now. The default is ACH or delays.
File protests on anything still protectable. Do not wait to see how CAPE shakes out first. The court order covers unliquidated entries and liquidated entries still within the 180 day protest window. If you have entries that went final liquidated before the ruling and the protest clock has run out, those are not covered yet.
Audit Your Broker Before You File Anything
Before you submit anything through CAPE, audit your entries. CBP is going to look hard at these claims. You are submitting a refund request to a federal agency that has $166 billion reasons to be skeptical. Every filing is an invitation to scrutinize your classification, valuation, and tariff applicability across the board.
We would rather find issues first than have CBP find them for us. That means a full audit before anything goes into that CSV.
Most importers have no idea how much money their broker has left on the table. We recently identified over $250K in refunds for NoBull due to their previous broker's data errors. Incorrect HTS codes. Wrong Chapter 99 classifications. Declared value mistakes. These errors compound over thousands of entries.
The IEEPA refund window is your chance to audit what your broker actually filed on your behalf. You need to know exactly how much you are owed in IEEPA refunds and whether your broker made classification or valuation errors that created additional overpayments beyond IEEPA.
Traditional brokers are manually tracking tariff changes. They are filing entries based on what worked last month. When Chapter 99 codes shift, when Section 232 rates change, when new exclusions take effect, manual processes miss them. You pay the difference.
There are downstream tax implications and follow on exposures that surface once you start pulling on this thread. Those are easier to manage when you find them proactively. The importers who move early are going to have more options and fewer surprises.
CBP Enforcement Proves Why That Audit Matters
CBP updated its trade enforcement statistics for FY 2025 and the numbers explain why finding broker errors before CBP does is not optional anymore.
Completed audits jumped from 417 to 465. Collections from audits went from $117.67 million to $235.5 million. That is a doubling of audit collections in one year.
Trade penalties issued rose from 2,204 to 2,432. Trade liquidated damages went from 22,399 to 53,052. That is a 137% increase. Penalty and liquidated damage collections increased from $26.3 million to $46 million.
Trade seizures climbed from 48,444 to 57,360. IPR seizures rose from 20,516 to 25,079 with an MSRP value of $7.4 billion. Shipments stopped for forced labor went from 4,850 to 7,325.
CBP is auditing more importers and collecting more money than ever before. High PSC rates get you flagged. Broker errors create audit exposure. The enforcement environment has fundamentally changed.
Manual processes cannot keep up with the pace of regulatory change we are seeing in 2026. Between Section 232 changes, Section 338 threats, IEEPA refunds, USMCA review, and ongoing Section 301 investigations, the compliance landscape is shifting weekly. Traditional brokers are running on archaic systems not built for this.
100% Tariffs on Patented Pharmaceuticals Start in 120 Days
President Trump signed an executive order imposing Section 232 tariffs on patented pharmaceuticals and active pharmaceutical ingredients. The baseline rate is 100%. This is not a typo.
For 17 large companies listed in Annex III, tariffs take effect July 31, 2026. For everyone else, September 29, 2026.
Companies with Commerce approved onshoring plans get 20% instead of 100%. But that 20% jumps to 100% on April 2, 2030. You have four years to complete onshoring or the rate goes back up. Companies with both onshoring plans and MFN pharmaceutical pricing agreements with HHS get 0% through January 20, 2029.
Generics, biosimilars, and specialty products are exempt for now. The Secretary will reassess the generic exemption in one year.
Section 338: The Never Used Retaliatory Authority Everyone Is Suddenly Talking About
Section 338 of the Tariff Act of 1930 has been on the books for 94 years and has never been used. It authorizes tariffs up to 50% on products from countries that discriminate against US commerce. If discrimination continues, the President can block imports entirely.
The statute is remarkably short and vague. The International Trade Commission has a duty to ascertain whether countries are discriminating and bring the matter to the President. But the statute also says the President can impose tariffs whenever he finds as a fact that discrimination exists. Whether the President must wait for ITC findings or can act unilaterally is unclear because it has never been tested.
What counts as discrimination? The law does not say. The administration could argue that any country maintaining tariffs on American goods is discriminating. Section 338 has no investigation requirement, no public disclosure requirement, and no time limits. For an administration looking to replace IEEPA tariff authority after the Supreme Court ruling, that vagueness is useful.
Section 338 applies to goods that are the growth or product of a country and to goods imported in a vessel of that country. That vessel clause creates logistics arbitrage. A Chinese manufactured good on a Chinese flagged vessel faces the tariff. The same good on a Liberian flagged vessel does not. Reflagging is easier than moving a factory.
Some in Congress introduced legislation to repeal Section 338 in March 2025. That bill is going nowhere. If the administration invokes this authority, expect immediate legal challenges on constitutional grounds.
USTR's 2026 Trade Agenda: More Tariffs, More Enforcement, USMCA on the Chopping Block
The Office of the US Trade Representative released its 2026 trade policy agenda titled "Double Down on the America First Trade Policy." The title tells you everything.
USTR claims the policy is working. The US trade deficit decreased year over year every month through December 2025. The US trade deficit with China dropped 32% from 2024 to 2025. For the first time since 2000, China is no longer the trading partner with the largest US trade deficit.
Here is what USTR is focused on for 2026.
Continue the Agreement on Reciprocal Trade program and push for lower foreign tariffs and non tariff barriers. Enforce existing ART commitments and pursue enforcement when necessary. Evaluate whether to initiate new Section 301 investigations to address global overcapacity, unfair agricultural policies, pharmaceutical pricing, digital services taxes, and other structural distortions.
Secure supply chains for critical minerals and sectors by reshoring industry and diversifying trade. This includes pharmaceuticals, metals, energy technologies, semiconductors, auto parts, and critical mineral production.
Conduct the USMCA review. USTR will negotiate to resolve issues and will only recommend renewal if resolution is achieved. Issues include a surge in investment from companies in non market economies, industrial overcapacity, a need to strengthen rules of origin, growing US trade deficits with Canada and Mexico, Mexico's preferential measures for national energy champions, inadequate labor laws, Canadian dairy violations, and discriminatory digital measures.
Manage trade with China for reciprocity and balance through arrangements negotiated by political leaders.
The USMCA review is the one to watch. If issues are not resolved, the agreement could be non renewed. For importers relying on USMCA preferential treatment, that creates real risk.
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