What Are Tariff and Duty Costs for FBA Sellers?
Tariff and duty costs are the government-imposed taxes you pay when importing products into the United States. For Amazon FBA sellers sourcing from China (which is the vast majority), tariff and duty costs represent one of the largest components of your landed cost, often adding 10-30% on top of your factory price.
Every product imported into the US is classified under a Harmonized Tariff Schedule (HTS) code, which determines the base duty rate. On top of that base rate, products from China are subject to additional Section 301 tariffs ranging from 7.5% to 100% depending on the product category. The combined effect means an FBA seller importing a common consumer product from China might pay 15-50% in total duties on the declared customs value.
Understanding tariff and duty costs is not optional for FBA sellers who import. Getting your HTS classification wrong, missing a Section 301 surcharge, or failing to account for duty changes can turn a profitable product into a money loser overnight. These costs flow directly into your COGS and affect every downstream profitability metric.
How to Calculate Import Duties
The basic formula:
Total Duty = (Customs Value x Base MFN Duty Rate) + (Customs Value x Section 301 Rate)Where:
- Customs value = typically the transaction value (FOB price x quantity), though it can include freight for CIF valuations
- Base MFN duty rate = the standard duty rate for your product's HTS code, ranging from 0% to 25%+
- Section 301 rate = the additional tariff on Chinese imports (7.5%, 25%, or higher depending on the product list)
Look up your product's HTS code at hts.usitc.gov. The HTS is a 10-digit classification system. The first 6 digits are internationally harmonized; digits 7-10 are US-specific and determine your exact duty rate.
Worked Example
You're importing silicone kitchen utensils from Shenzhen, China. Your order: 2,000 units at $3.20 FOB per unit.
Step 1: Identify the HTS code. Silicone kitchen utensils typically fall under HTS 3924.10.40 (tableware and kitchenware of plastics). Base MFN duty rate: 3.4%.
Step 2: Check Section 301 status. This product falls under List 3 of the Section 301 tariffs at a 25% rate.
Step 3: Calculate customs value. 2,000 units x $3.20 = $6,400 customs value (FOB).
Step 4: Calculate duties.
Base duty: $6,400 x 3.4% = $217.60 ($0.11/unit)
Section 301 tariff: $6,400 x 25% = $1,600.00 ($0.80/unit)
Total duty: $1,817.60 ($0.91/unit)
That $0.91/unit in tariff and duty costs represents 28.4% of your $3.20 FOB price. On a product selling for $19.99 on Amazon, duties alone consume 4.6% of your revenue before any other costs.
Important note on the de minimis threshold: As of May 2025, the $800 de minimis exemption for Chinese imports was eliminated. All shipments from China now require formal customs entry regardless of value.
Section 301 Tariffs: What FBA Sellers Need to Know
Section 301 tariffs were imposed on Chinese imports starting in 2018 across four product lists. Current rates as of 2026:
| List | Approximate HTS Lines | Current Rate | Common FBA Categories Affected |
|---|---|---|---|
| List 1 | 818 | 25% | Industrial components, machinery parts |
| List 2 | 279 | 25% | Electronics components, plastics |
| List 3 | ~5,700 | 25% | Kitchen, home, toys, apparel accessories |
| List 4A | ~3,200 | 7.5-15% | Consumer electronics, furniture, textiles |
Most FBA consumer products fall under Lists 3 or 4A. Always verify your specific HTS code at ustr.gov because tariff exclusions and rate changes occur periodically. As of March 2026, 178 exclusions remain active through November 2026.
Tariff and duty costs directly affect your contribution margin. A 10% tariff increase on a $5 product adds $0.50/unit to your landed cost. If you sell 1,000 units/month, that's $6,000/year in additional costs that comes straight from your bottom line unless you raise prices.
Common Mistakes
1. Using the wrong HTS code. HTS classification is complex. A "silicone" kitchen tool might classify under plastics (Chapter 39) or rubber (Chapter 40) depending on its silicone composition, with different duty rates. Using the wrong code means either overpaying duties or risking a customs audit and penalties. When in doubt, consult a licensed customs broker before your first shipment.
2. Forgetting Section 301 tariffs exist. Many profit calculators and landed cost spreadsheets only include the base MFN duty rate. If your product is on Section 301 Lists 1-4A, the additional tariff can be 7.5-25% on top of the base rate. Omitting this from your landed cost calculation can understate COGS by 15-25%.
3. Not updating duty rates when they change. Tariff rates, exclusions, and Section 301 lists change regularly. Sellers who set up their cost models once and never update them gradually drift from reality. Check your HTS codes and applicable rates quarterly, especially when trade negotiations or policy changes are in the news.
Related Glossary Terms
Tariff and Duty Costs FAQ
What is an HTS code?
An HTS (Harmonized Tariff Schedule) code is a 10-digit classification number that identifies your product for US customs purposes. The code determines your base duty rate. You can look up HTS codes at hts.usitc.gov.
How do I find my product's duty rate?
Look up your product's HTS code at hts.usitc.gov, which shows the base MFN duty rate. Then check if your product falls under Section 301 tariffs (most Chinese imports do), which adds an additional 7.5-25% on top of the base rate.
What are Section 301 tariffs?
Section 301 tariffs are additional duties imposed on Chinese imports, ranging from 7.5% to 100% depending on the product category. They apply on top of the standard MFN duty rate, significantly increasing the total import cost for FBA sellers sourcing from China.
How do tariffs affect my FBA profitability?
Tariffs directly increase your landed cost, which reduces your contribution margin per unit. A product with a 5% base duty plus a 25% Section 301 tariff pays 30% in total duties on its customs value. On a $5 FOB product, that is $1.50 per unit in duties alone.
Can I avoid Section 301 tariffs by sourcing from another country?
Sometimes. Sourcing from Vietnam, Thailand, India, or Mexico can avoid Section 301 tariffs since they apply specifically to Chinese imports. However, base MFN duty rates still apply, and country-of-origin rules require substantial transformation, not just transshipment, to qualify for non-Chinese tariff treatment.