New 10% U.S. Tariffs

Understanding the New 10% U.S. Tariff on Chinese Imports

On February 4, President Trump imposed an additional 10% tariffs on imports from China. This affects businesses that source travel goods like luggage, backpacks and handbags. These changes will increase costs and impact supply chains. In this article, we explain what this means and how businesses can respond.

What is the New 10% Tariff on China?

As of 2025, the U.S. government has imposed a 10% tariff on all Chinese imports. This is in addition to existing tariffs, making imports more expensive. The goal is to reduce dependence on Chinese manufacturing and encourage local production. However, many businesses still rely on China, especially in the travel goods sector.

Update:

On March 4, President Trump added a new 10% tariff on all U.S. imports from China and a 25% tariff on most imports from Mexico and Canada, which was later delayed. This new 10% tariff on China is in addition to the one added on February 4 and the existing 25% Section 301 tariffs from Trump’s first term.

President Trump also plans to introduce 'reciprocal tariffs' on countries that charge higher tariffs on U.S. goods than the U.S. charges on theirs. An update is expected in April.

End of the De Minimis Loophole - Update

Previously, companies used the "de minimis" rule, which allowed goods under $800 to enter duty-free. This was helpful for e-commerce players and small businesses. The provision was initially set to be suspended under the new tariff policy.

However, on 7th February 2025, the Trump administration announced a delay in the suspension of the de minimis rule. The delay will last until “adequate systems are in place” for the Commerce Department to fully and expediently process and collect tariff revenue. The executive order did not specify how long the delay would last. Despite the delay, businesses should prepare for the eventual suspension of de minimis benefits and explore alternative strategies.

Impact on Travel Goods Imports

The new 10% tariff adds to existing tariffs (17.6% - 20%) and the 25% China Section 301 tariffs, raising import costs significantly:

• Soft side travel goods: 17.6% tariff + 25% Section 301 tariff + 10% new tariff = 52.6% total tariff
• Hard shell & plastic travel goods: 20% tariff + 25% Section 301 tariff + 10% new tariff = 55% total tariff

The Executive Order also removes duty-free entry for Chinese-origin products under de minimis (Section 321) and bans duty drawback for U.S. imports from China.

How This Affects Travel Goods Companies

1. Higher Costs: Importers will pay more, which may increase retail prices.
2. Supply Chain Disruptions: Companies relying on China will face logistical challenges.
3. New Sourcing Strategies: Businesses may shift production to a new location.
4. Operational Changes: Some companies are storing products in U.S. warehouses to avoid extra costs.

Step-by-Step Guide for Brands to Adapt

1. Review Your Supply Chain: Identify how these tariffs affect your business.
2. Find New Suppliers: Look for alternative manufacturing hubs with lower tariffs, e.g. Indonesia, Thailand.
3. Negotiate with Manufacturers: Discuss better pricing and flexible production terms.
4. Optimize Shipping: Consolidate shipments and explore cost-effective freight options.
5. Adjust Pricing: Decide whether to absorb costs or increase prices.
6. Ensure Compliance: Stay updated on U.S. trade laws to avoid penalties.
7. Use Trade Incentives: Explore free trade agreements or bonded warehouses.
8. Diversify Sales Markets: Reduce dependence on the United States by expanding to Europe and Canada.

The new 10% tariff on all Chinese goods is a challenge for travel goods businesses. It raises costs and disrupts supply chains, but it also presents opportunities. By adjusting sourcing strategies, optimizing logistics and exploring new markets, businesses can stay competitive.

If you're looking for reliable alternative suppliers, our B2B platform connects you with top manufacturers worldwide. Explore new sourcing opportunities to stay ahead in the travel goods market.