Not automatically. The Section 122 surcharge is set to expire by law on July 24, 2026, but a federal appeals court has already paused the ruling that struck it down, so the 10% is still being collected today. USMCA-qualifying goods from Canada and Mexico stay exempt either way, and the administration has queued Section 301 and Section 232 tariffs that could replace whatever Section 122 leaves behind.
The 10% Section 122 tariff — the flat surcharge Trump imposed on most imports hours after the Supreme Court struck down his IEEPA tariffs on February 20 — has a hard 150-day statutory clock. That clock runs out at 12:01 a.m. Eastern time on July 24, 2026, and only Congress can extend it. No extension bill has moved so far. But "expires" doesn't mean "goes away." A trade court already ruled the tariff illegal back in May, and importers still paid it the next day — the ruling only covered the three named plaintiffs who sued (two companies and the State of Washington). Then in June, a federal appeals court paused even that narrow ruling while it hears the government's appeal. So right now, about four weeks into that pause, the 10% is still landing on every non-exempt shipment that clears customs, and it will keep landing until the 150 days run out on their own.
Why did the tariff show up in the first place?
Because officials framed it that way from the start. When the Supreme Court ruled that the emergency-powers law (IEEPA) never authorized tariffs at all, the White House pivoted the same day to Section 122 of the Trade Act of 1974 — a Cold War-era provision last used by Nixon in 1971, which lets a president impose a surcharge of up to 15% for no more than 150 days to address a "balance of payments" problem. Administration officials have since described it publicly as a bridge measure, meant to hold the line while Section 301 and Section 232 tariffs get built out. It's a narrow, temporary tool by design. That's exactly why it has a built-in expiration date the White House can't move on its own.
So does the tariff just vanish on July 25?
Only in the narrowest sense — the Section 122 line item disappears from customs paperwork. Everything else keeps moving. The U.S. Trade Representative has a Section 301 determination on forced-labor enforcement practices, covering roughly 60 trading partners, that proposes additional duties of 10% to 12.5% — with a public hearing today, July 7. A separate Section 301 investigation into manufacturing overcapacity is also underway, with the administration reportedly aiming to wrap both up before Section 122 expires, though no specific rate has been proposed yet for that second track. Section 232 tariffs on steel and autos sit completely outside Section 122 already, and a new round covering patented pharmaceuticals and active pharmaceutical ingredients — 100% duties — is set to phase in July 31 for larger companies and September 29 for others. Whether your landed cost actually falls on July 25 depends on which of these replaces the gap — not on Section 122 alone.
What about goods from Canada and Mexico — are those exempt?
Goods that qualify for USMCA origin treatment have been carved out of the Section 122 surcharge from the start, and that doesn't change based on trade politics. On July 1, the three countries held the USMCA's first mandatory six-year review, and the U.S. declined to lock in another 16-year term — USTR said flatly that "the United States did not agree to renew the USMCA in its current form." That sounds bigger than it is: the agreement doesn't expire. It stays fully in force, with all current tariff preferences and rules of origin intact, through its original end date of July 1, 2036. What changes is procedural — instead of one review every six years, the three countries now have to hold this same review every year until someone agrees to extend it.
↑ Live coverage of the trilateral meeting where the U.S., Canada, and Mexico held the July 1 USMCA review.
| What happened July 1 | What it means today |
|---|---|
| US declines 16-year renewal | Triggers annual reviews, not termination |
| USMCA tariff exemptions | Unchanged — still in force |
| Agreement's scheduled end date | Still July 1, 2036 |
| Next negotiating round | US–Mexico, week of July 20 |
How much is this actually costing households right now?
The Tax Foundation's latest modeling — updated in April — puts the average U.S. household's 2026 tax increase from currently active tariffs at $1,500, which the think tank calls the largest U.S. tax increase as a share of GDP since 1993. A separate Tax Foundation analysis of retail prices found overall prices running about 4.9% above the pre-tariff trend, with imported goods up roughly 6% versus about 4.3% for domestic goods — with apparel, coffee and tea, cameras, household textiles, and furniture among the categories seeing the sharpest increases.
What happens if the USMCA exemptions eventually go away?
Nobody has removed them — this is a modeled scenario, not something that's happened. But the Tax Foundation ran the numbers on what it would cost if the exemptions disappeared: about $466 billion in additional taxes from 2027 through 2036, or roughly $300 per U.S. household in 2027 alone, plus an estimated 95,000 fewer full-time-equivalent jobs. That's the number to watch if the annual reviews eventually produce a deal that narrows or drops the USMCA carve-outs — it isn't in effect today.
What this means for your grocery bill and your shopping cart
Don't expect a clean before-and-after on July 24. The most likely path, based on how the administration has sequenced its Section 301 and Section 232 actions, is a partial handoff: some product categories lose the 10% and land at ordinary rates, others get picked up by new sector-specific duties at similar or higher levels. Given that Congress hasn't moved on an extension and no single replacement has been finalized, the honest answer is that nobody — including the importers who pay these duties — has full visibility past July 24 yet.
See what this tariff actually costs your household
Run your numbers through Calcugui's calculator to estimate how much of your family's spending is tied up in tariff-affected imports right now.
Try the Calculator →