The office of the United States Trade Representative (USTR) has finalized a new 25% Section 301 tariff on a broad range of Brazilian-origin goods. The action, announced in a Federal Register notice takes effect on July 22, 2026, and importers of Brazilian goods should act now to understand how it affects their supply chains.
The tariff stems from a Section 301 investigation that USTR initiated in July 2025, at the President’s direction, into a range of Brazilian trade practices. USTR determined that Brazil’s conduct related to digital trade and electronic payment services, preferential tariffs, anti-corruption enforcement, intellectual property protection, ethanol market access, and illegal deforestation unreasonably burdened US commerce.
Effective Dates and Transit Exemption
The 25% additional duty applies to Brazilian goods entered for consumption, or withdrawn from warehouse for consumption, on or after July 22, 2026.
A limited transit exemption is available: goods that were already loaded onto a vessel at the port of loading and in transit on the final mode to the US before July 22 are exempt from the tariff, provided they are entered for consumption (or withdrawn from warehouse for consumption) no later than July 29, 2026.
Products Excluded from the Additional Duty
USTR’s list of exceptions is largely centered on products where domestic or third-country supply is judged insufficient, or where tariffs would be unlikely to change Brazil’s underlying conduct. Broad categories exempted from the additional 25% duty include:
- Informational materials, donations, and accompanied baggage
- All articles and parts of articles subject to Section 232 tariffs
- Raw materials that could lead to the unavailability of domestic supply if subject to the proposed additional tariffs
- Products that could cause economy-wide disruptions if subject to the proposed additional tariffs
- Products unable to be grown or produced in sufficient quantities in the United States or obtained from other sources
- Articles for which additional tariffs may not contribute substantially to the elimination of Brazil’s acts, policies, and practices
USTR also expanded the exemption list beyond its original June 2026 proposal, in response to comments, to include aluminum hydroxide, antiques/collectibles/art, ash containing precious metals, certain animal hides/furskins/leather, certain seafood products, additional pharmaceutical ingredients, certain additional wood products, iron and steel waste and scrap, organic honey, pig iron, and used clothing. USTR also removed or reduced items from the list including several chemical exemptions to cover only their pharmaceutical applications.
Effective July 31, 2026, patented pharmaceutical articles will also be added to the list of products exempt from stacking with Section 232 duties.
Foreign Trade Zone Impact
Any Brazilian product subject to the new duty that is admitted into a U.S. Foreign Trade Zone — unless eligible for “domestic status” under 19 C.F.R. 146.43 — must be admitted under “privileged foreign status” (19 C.F.R. 146.41) as of the date the additional duty takes effect.
Other Duties Still Apply
Products subject to the new Section 301 duty remain subject to any applicable antidumping, countervailing, or other existing duties, taxes, and fees — the 25% is additive, not a replacement.
USTR has indicated it will continue to monitor Brazil’s conduct and may modify or terminate the action under Section 307 of the Trade Act if circumstances change. Importers should confirm whether their products fall under exemption and whether any in-transit shipments qualify for the July 29 transit deadline.
Contact your Mohawk Global representative with any questions.