Fentanyl Tariff on China 9-16-25

As of September 2025, the United States maintains a 20% "fentanyl" tariff on Chinese goods, in addition to other reciprocal tariffs that were recently reduced but are set to potentially increase again if further agreements aren't reached. The 20% fentanyl tariff, implemented via Executive Order 14195 in February 2025, is intended to address the illicit drug crisis. 

Here's a breakdown of the current tariff situation: 

20% Fentanyl Tariff: This specific tariff was first set at 10% in February 2025 and then increased to 20% in March 2025, remaining in place today. 

Reciprocal Tariffs: In May 2025, the U.S. and China agreed to a temporary reduction of reciprocal tariffs, bringing the baseline tariff down to 10% and consequently lowering the total tariff rate on many Chinese goods. 

Future of Reciprocal Tariffs: However, this agreement was for a limited period, and the reciprocal tariff rate was set to rise to 34% (10% baseline + 20% fentanyl) if a longer-term deal wasn't reached by August 2025. 

Tariff Tracker: The specific reciprocal tariff rate that will apply moving forward is subject to change. For example, there were further discussions to raise the reciprocal tariff to 125%. 

Key Points:

Differentiated Tariffs: The U.S. maintains distinct tariff rates for goods originating from China, differentiating between the "fentanyl" tariff and the "reciprocal" tariff. 

Legal Basis: The fentanyl tariffs are imposed under the authority of the International Emergency Economic Powers Act (IEEPA). 

Ongoing Negotiations: The situation is dynamic, with the potential for tariffs to increase or decrease based on ongoing trade negotiations between the U.S. and China. 

As of September 2025, the fentanyl-related tariff on goods imported from China is 20%, though a recent court ruling has challenged the legality of the tariff. This duty is separate from other tariffs and contributes to an overall variable tariff rate. 

The 20% fentanyl-related tariff

• In February and March 2025, President Trump invoked the International Emergency Economic Powers Act (IEEPA) to impose an initial 10% tariff on Chinese goods, which was later increased to 20%.
• The White House stated that this action was taken due to a national emergency caused by the flow of illicit fentanyl from China. 

Impact on total tariff rates

• This 20% tariff is applied in addition to any pre-existing duties, such as those imposed under Section 301 and Section 232.
• For example, Chinese goods also affected by a 10% reciprocal tariff face a baseline tariff of 30% plus any product-specific duties. The total tariff can reach as high as 55% or more, depending on the item. 

Ongoing legal uncertainty

• In May 2025, the U.S. Court of International Trade (CIT) ruled that the IEEPA tariffs, including the fentanyl-related ones, were illegal and exceeded the President's authority.
• This decision was largely upheld by the Federal Circuit in August 2025, though the case was remanded for further evaluation.
• The Department of Justice appealed, and the Supreme Court agreed in September 2025 to hear the case, with oral arguments scheduled for November.
• Until the Supreme Court issues a final ruling, the tariff remains in effect. 

Broader trade context

• In August 2025, a trade truce that temporarily capped additional reciprocal tariffs was extended until November 10, 2025, allowing time for continued negotiations.
• Negotiations with Chinese officials are ongoing, with topics including trade, tariffs, and counternarcotics cooperation. 

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Comments

The Supreme Court will review the Tariff Authority in November 2025.

Norb Leahy, Dunwoody GA Tea Party Leader