Countdown to 40% Tariffs: What Importers Need to Do by August 1, 2025

Tariffs are set to increase as high as 40% by August 1, squeezing margins, but you still have time to take action.

The U.S. trade landscape just shifted again, and if you’re importing from Southeast Asia, Eastern Europe, and other BRICS-aligned countries, your costs could surge overnight.

On July 7, 2025, President Trump signed a new Executive Order extending the temporary 10% reciprocal tariff window through August 1, but confirmed that steep duty increases will take effect immediately after.

Additionally, a July 6, 2025, post on Truth Social warned that any country aligning with BRICS could face an additional 10% tariff, further signaling heightened trade risks across key global regions.

Here’s what it means, how to act fast, and how to protect your margins.

Key Takeaways from Executive Order Issued July 7, 2025

The Situation: A Narrow 10% Window Before Tariffs Spike

Temporary 10% Tariff Extended Through August 1, 2025. As outlined in Executive Order 14257 , the suspension of full reciprocal duties for countries listed in Annex I (excluding China) has been extended:

• Start Date: 12:01 a.m. EDT on July 9, 2025
• End Date: 12:01 a.m. EDT on August 1, 2025

During this window, eligible goods are subject to a reduced 10% duty rate, rather than the full reciprocal tariff scheduled to take effect on August 1, 2025.

China Excluded

China remains excluded from this suspension. Tariff treatment for Chinese-origin goods remains in effect under Executive Order 14298 (May 12, 2025), which imposes separate and higher tariff rates.

Vietnam’s Unique Status

Per a new U.S.-Vietnam trade deal (signed July 2, 2025), imports from Vietnam face a 20% base tariff and a 40% tariff for transshipped goods. However, because Vietnam is not explicitly excluded from the temporary suspension, Vietnamese-origin goods may be eligible for the 10% rate until August 1, pending final classification and HTS rulings. Importers should consult their brokers and verify their eligibility before making an entry.

What’s Coming August 1, 2025: Tariffs Up to 40%

The following countries will be subject to new reciprocal tariff rates starting August 1, 2025, unless covered by a formal trade agreement:

These new tariffs are expected to remain in place indefinitely unless formal trade agreements are reached. Importers should prepare now to avoid financial disruption.

New Risk: 10% Tariff Threat for BRICS-Aligned Nations

On July 6, 2025, President Trump posted the following message on Truth Social:

“Any country aligning themselves with the Anti-American policies of BRICS will be charged an ADDITIONAL 10% Tariff. There will be no exceptions.”

Although this has not yet been formalized in an Executive Order, it sends a strong policy signal. Countries initially aligned with BRICS (Brazil, Russia, India, China, South Africa) and those that have been invited or aligned with BRICS+ (including Iran, Egypt, the UAE, and Ethiopia) may face new or expanded penalties in 2025.

If your supply chain operates in these regions, begin evaluating alternative sourcing and pricing models immediately.

Strategic Quick Wins for Importers

What This Means for Importers

To understand the impact of these tariff hikes, let’s look at a real-world example:

• You’re importing a shipment from Indonesia worth $600,000.
• If the goods clear U.S. Customs before July 31, you’ll pay the current 10% tariff, totaling $60,000.
• But if the same shipment clears on or after August 1, you’ll be hit with the new 32% tariff, totaling $192,000.

That’s a $132,000 difference, just for missing the clearance window by a day.

This kind of cost spike doesn’t just affect your landed costs. It can:

• Slash your profit margins
• Force you to raise prices
• Drain working capital
• Disrupt inventory planning

That’s why importers need to move quickly and strategically.

What You Should Do Right Now

Run Landed Costs Test

Use historical pricing + projected August tariffs to assess margin pressure. Express Trade Capital can assist with full landed cost modeling and financial planning to help quantify your exposure and inform your sourcing decisions. Learn more about how our services can help.

Tap Duty Mitigation Tools

We’ll coordinate with your brokers or legal advisors to ensure your goods are structured adequately for duty minimization. Our compliance and logistics team can walk you through the options.

Lock in Supplier Contracts

Secure terms before tariff hikes erode negotiating leverage. Express Trade Capital can support this process with flexible Letters of Credit, helping you maintain leverage and secure favorable terms with both new and existing vendors.

Diversify Suppliers

Pre-vet alternate sources outside affected zones to avoid single-source risk. Our global trade network and sourcing expertise enable us to advise on alternative trade corridors, financing transitions, and mitigating overexposure to high-risk zones.

Hedge & Finance

Utilize receivables financing to safeguard your working capital. Whether you need PO funding tied to your factoring line or liquidity to bridge tariff-related cost spikes, Express Trade Capital’s financial solutions are designed to keep your operation resilient.

How Express Trade Capital Can Help

We’re more than a trade finance provider. We’re your strategic partner!

Factoring and Purchase Order Financing

Maintain liquidity during periods of increased duty exposure or supplier payment pressure. Our solutions are tailored to support high-volume importers managing tight cash cycles.

Letters of Credit (LCs)

Secure supplier confidence and mitigate payment risk, particularly when working with new suppliers. We issue and manage custom LCs that align with your terms and protect both sides of the transaction.

Supply Chain Agility

From analyzing alternate country-of-origin options to rerouting inventory in transit, our team can help restructure your trade flow to reduce exposure and protect profit margins.

• Alternate Sourcing Guidance: Minimize exposure by optimizing trade routes.
• Transshipment Strategy: Ensure compliance and avoid misclassification penalties.

Tariff Risk Modeling

We help importers assess tariff risks, calculate the impact of landed costs, and coordinate with brokers or legal advisors to ensure proper classification and documentation.

• Landed Cost Calculations: Quantify new cost realities.
• Classification Support: Partner with brokers/legal to confirm HTS codes.

Resources and Next Steps

• View the July 7 Executive Order
• Contact Express Trade Capital for a one-on-one risk assessment

Final Thought

The August 1 tariff increase is not theoretical; it’s locked in. Importers who act now can avoid steep financial consequences. Those who wait risk being hit with sudden, margin-erasing costs.

Let Express Trade Capital help you move fast, with clarity, capital, and confidence.