Section 338 Canada Tariffs: 100 Lines Added to the 50% Duty List

The United States widened the Section 338 tariff it levies on Canadian goods, adding one hundred HTSUS classifications to the 50 percent duty list while removing twenty two, in a scope change that took effect at 12:01 a.m. Eastern on October 30. The modification was published in the Federal Register on October 30 as docket 2026-22292 and signed by the President on October 23, according to the proclamation, and U.S. Customs and Border Protection followed with filing guidance under CSMS number 70314289 the same week.

This is the fourth adjustment to the Section 338 program since it was first imposed on July 20, and the pattern matters for anyone moving goods across the northern border. The modification is an expansion. CBP's updated Section 338 Canada HTS list, posted October 29, marks the newly covered classifications in bold, and the agency confirmed that one hundred additional classifications are now subject to the 50 percent duty under heading 9903.03.14. At the same time, twenty two classifications were removed from the list, which is why plywood sheets, certain paper and packing products, and some machinery and refrigeration equipment that had been facing the surcharge are no longer in scope.

Related reading: Canada Import Bans Reach Federal Register as Volumes Turn.

What the October 30 change does to entries

The filing mechanics tell importers exactly when the new scope binds. Per CBP guidance, the modification applies to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern on October 30. The removed lines still carried the 50 percent duty on entries made before that cutover, and goods already in transit that clear after the effective moment fall under the new list. That transition cut creates a discrete, dated compliance risk for cargo on a vessel or railcar headed for the border when the change took effect.

For the one hundred added lines, the levy is a straight 50 percent ad valorem duty, stacked on top of any applicable antidumping, countervailing, and other duties, taxes, fees and exactions, per the CBP filing provisions. The agency reiterated that covered goods remain subject to antidumping and countervailing duties and other charges, so a line is not cheaper just because it cleared the Section 338 screen. CBP also confirmed that classifications under headings 9903.03.12 and 9903.03.13 are unchanged and continue to carry the 50 percent additional duty, which keeps the program's motor-vehicle and alcoholic-beverage tracks intact.

Related reading: US Bans BGI and MGI Genomics Imports on Forced Labor.

Compliance has hard edges. Goods admitted to a U.S. Foreign Trade Zone generally must enter under privileged foreign status unless they qualify for domestic status, and the existing Chapter 98 exceptions continue to apply subject to specified exclusions and valuation rules for certain repairs, alterations, processing and foreign assembly.

CBP's ACE messaging rejects noncompliant entries with specific reason codes, including 239 for HTS not allowed for country of origin on FTZ admissions and 335 for the same condition at cargo release, so a mis-scoped entry does not quietly pass. The additional duties under headings 9903.03.12 through 9903.03.14 remain eligible for drawback, which is one cost recovery path for U.S. processors.

Related reading: US Extends Section 301 Suspension on Chinese Vessel Fees to January 9, 2027.

The escalation behind the widening

The October 30 modification caps a fast-moving ladder rather than opening a new fight. Section 338 of the Tariff Act of 1930 lets the President impose duties on products of a country that discriminates against U.S. commerce. On September 8, the administration signed five Section 338 proclamations after Canada, in the White House's telling, broke off trade talks in August and imposed roughly 20 billion dollars in new retaliatory tariffs on U.S. exports covering steel, dairy and agricultural equipment.

Three of those September 8 proclamations excluded certain Canadian motor vehicles, dairy products and alcoholic beverages from importation, effective September 29, while two modified the duty scope.

Related reading: Commerce Moves to Choke Off Polysilicon Stockpiling Before Section 232 Tariffs Land December 4.

That first scope modification, effective September 15, added 122 classifications between headings 9903.03.12 and 9903.03.14 while removing two lines from the motor-vehicle heading, including rock salt and cement, and pulling fishing rods from the broader heading. The program has therefore moved in both directions across its short history: a September broadening, an October removal of twenty two lines, and now a net widening of the 50 percent list by one hundred more classifications. The September 29 import exclusions, meanwhile, cover certain dairy, alcohol and motor-vehicle products already specified in annexes, with excluded goods banned from Foreign Trade Zones, bonded warehouses and in-bond transport and ineligible for entry for consumption.

The immediate task is mechanical. Importers should review the updated CBP HTSUS list against their Canadian tariff classifications and verify the Chapter 99 reporting requirements for entries on or after October 30, as CBP guidance directs. For a fleet of SKUs, that means re-mapping the whole book against the bolded additions before the next entry filing, because an overlooked added line turns a routine entry into a rejected or mis-rated one. The removed classifications are a genuine cost relief for anyone moving plywood, certain papers, packing materials and refrigeration or food-processing equipment, but only once the effective-date cutover is accounted for in the filing.

What comes next is the bigger question. The tariff has been reshaped four times in about three months, each round with a new Federal Register docket and CBP guidance, a sign USTR and CBP treat the list as a live instrument. The widening direction of the October 30 round, with Canada's retaliation still in force, points to more adjustments rather than a freeze. The 50 percent rate is unchanged; it is the scope that keeps moving, which is exactly why the effective dates and the HTS list revisions, not the headline rate, are the operating data for anyone moving goods between the two countries.

Sources

Federal Register, Proclamation 2026-22292, further modifying the scope of products of Canada subject to additional duties, published October 30, 2026: federalregister.gov/documents/2026/10/30/2026-22292.

U.S. Customs and Border Protection, CSMS 70314289, Section 338 Canada modified HTS list and filing guidance, issued October 29, 2026: content.govdelivery.com/accounts/USDHSCBP.

CBP, updated Section 338 Canada HTS list effective October 30, 2026: updated Section 338 Canada HTS list.

White House fact sheet and presidential actions describing the September 8 Section 338 proclamations, September 15 scope modifications and September 29 exclusions: whitehouse.gov/fact-sheets/2026/09.

GHY trade-compliance summary of the October 30 Section 338 scope change and prior adjustments: ghy.com/trade-compliance.

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