The Section 122 surcharge expired, and a Section 301 tariff replaced it the same day. Here’s how to rerun the real number before it quietly eats your BFCM margin and the cash behind it.
The tariff regime reset again on July 24. That’s the fourth time this year we have had to tell a founder their landed cost is no longer the number they think it is.
Here’s what happened, in plain terms. The flat 10 percent Section 122 surcharge expired. The same day, a new Section 301 tariff took its place, 10 or 12.5 percent depending on where your product is made. For some of my clients, that was close to a wash. For one, it actually moved the wrong way.
This is not a panic post. It is a math post. Your landed cost changed on a specific date, and if you have not rerun it, you are about to place your biggest inventory order of the year off a number that is no longer true. There are two things worth checking this week, and we will walk you through both.
What Actually Changed on July 24
The 10 percent Section 122 surcharge that had been sitting on top of imports expired by law on July 24. On its own, that sounds like good news.
But it did not disappear into nothing. A new Section 301 tariff replaced it the same day, set at 10 or 12.5 percent depending on your country of origin. So “the surcharge expired” is true and misleading at the same time. What actually happened is that one broad charge came off and a country-specific one went on.
For context, this is the fourth time the US tariff regime has reset this year. We have stopped trying to predict where it lands next, and the new duty is already being challenged in court, so we would not bet the farm on today’s numbers holding all the way through December either. What we can tell you is that the number moved, it moved on a known date, and the direction it moved depends entirely on where you make your product.
Why “Just Subtract 10 Percent” Is the Expensive Mistake
Here is the trap most brands fell into the week it happened. They saw the 10 percent surcharge expire and assumed their costs dropped 10 percent. They did not.
Depending on your country of origin, the new Section 301 duty cancels out some or all of that drop. For a brand sourcing from one country, the change might net out close to zero. For a brand sourcing from another, it might cost more than before. There is no single answer that applies to everyone, which is exactly why “just subtract 10 percent” is dangerous. It feels like a shortcut, and it plants a wrong number in your model.
And this is not a small model to get wrong right now. You are about to place your Black Friday production order, the biggest cash commitment most DTC brands make all year. If the per-unit landed cost feeding that order is off by a few points, the error does not stay small. It multiplies by every unit you order.
So the move is boring, and it works: rerun your landed cost on the new rates, per SKU, before your BFCM purchase order goes out. Not once. On a schedule, every time a headline breaks, because this is the fourth reset and it will not be the last.
The Number Almost Nobody Is Checking
Here is the second thing to check, and almost nobody is talking about it.
Back in February, the Supreme Court ruled the older IEEPA-based tariffs unlawful. If you imported and paid those tariffs in 2025, you may be owed a refund on what you paid.
We want to be careful here, because this is where founders either ignore it or overreact. The refund is a separate cash-recovery question. It does not change what you should order this month, and it does not change your PO math. Treat it as its own track: money you may have already overpaid, sitting on the table with your name on it. Worth chasing down with whoever handles your customs entries. Not worth letting it distract you from getting your forward-looking landed cost right.
Two different numbers. One is about the inventory you are about to buy. The other is about cash you may have already left behind. Check both.
What to Do This Week
None of this is complicated. It is specific.
Rerun your landed cost per SKU on the new rates. Not a blanket adjustment. Pull the actual Section 301 rate for each product’s country of origin and rebuild the per-unit number before you commit to your Black Friday order.
Put it on a schedule. Log today’s landed cost somewhere you will actually see it, and commit to rerunning it every time the tariff regime moves again. Four resets in one year means cost creep is now a standing risk, not a one-time event.
Check your 2025 refund eligibility. Ask whoever files your customs entries whether you paid IEEPA-based tariffs in 2025 and whether a refund claim applies to you. Keep it in a separate lane from your ordering decision.
Most founders find out their number moved when the invoice lands. By then it has already cost them. Doing this now, before the PO, is the difference between deciding your margin and discovering it.
Rerun It With Help, Not Guesswork
If you want the real number for your specific brand instead of a rule of thumb, that is exactly what Ask AI Lara is built for. And if the answer is that your costs went up and you need room back, the Tariff-Buster Negotiation Playbook walks through where to claw margin back across suppliers, freight, and terms.
Frequently Asked Questions About the July 24 Tariff Change
What changed with US tariffs on July 24, 2026? The flat 10 percent Section 122 surcharge on imports expired, and a new Section 301 tariff of 10 or 12.5 percent, depending on the country of origin, took effect the same day. The net effect on any given brand depends on where its products are made.
Did my landed cost go down when the surcharge expired? Not necessarily. The Section 301 tariff that replaced the surcharge can offset some or all of the reduction. For some countries of origin, the change is close to a wash, and for others landed cost can rise. The only way to know is to recalculate per SKU on the new rates.
How do I recalculate landed cost after a tariff change? Pull the current tariff rate for each product’s country of origin, apply it alongside product cost, freight, duties, and handling, and rebuild the per-unit landed cost SKU by SKU. Do this before placing a purchase order, and rerun it whenever tariff rates change again.
Am I owed a tariff refund from 2025? Possibly. The Supreme Court ruled the earlier IEEPA-based tariffs unlawful in February 2026. Importers who paid those tariffs in 2025 may be eligible for a refund. This is a separate cash-recovery process from your current landed-cost planning, so handle it through whoever files your customs entries.
Should the possible refund change my next purchase order? No. The refund is money potentially owed on past imports. Your next PO should be planned on your current, recalculated landed cost. Keep the two decisions in separate lanes.
If you take one thing from this: the number moved on July 24, and “probably fine” is the most expensive phrase in DTC supply chain. Rerun it before you order.
Until next time,
— Lara
Your Landed Cost Changed. So Did the Tariff Environment Behind It.
The July 24 reset is the fourth tariff change this year, and it won’t be the last. If you’re still sourcing from China, this isn’t just a cost update, it’s a strategy reset. Lara Guevara covers scenario planning for 145% tariffs, sourcing diversification, pricing under pressure, inventory positioning, vendor negotiation, and cash flow protection in one full workshop.
Already know your bottleneck?
Join the Supply Chain Lounge on Slack where we discuss these exact challenges every week.