Section 338: 50% on Annexed Canadian Goods From August 22, 2026

Three separate presidential proclamations, all signed July 20 and published July 23, 2026, each impose an additional 50 percent ad valorem duty on its own annexed list of Canadian goods under Section 338 of the Tariff Act of 1930 (19 U.S.C. 1338). Proclamation 11046 (91 FR 46639, FR Doc. 2026-14991, HTSUS heading 9903.03.12) annexes alcoholic beverages; Proclamation 11047 (91 FR 46653, FR Doc. 2026-14992, heading 9903.03.13) annexes dairy; and Proclamation 11048 (91 FR 46663, FR Doc. 2026-14997, heading 9903.03.14) annexes a broad basket of Canadian goods spread thinly across roughly 60 HTS chapters. Each answers a different Canadian trade practice. The three were originally scheduled to take effect August 19, 2026; Proclamation 11056 (91 FR 54789) delayed the start by three days, so the duties actually took effect at 12:01 a.m. eastern time on August 22, 2026, on goods entered for consumption or withdrawn from warehouse for consumption on or after that moment. Through September 14, 2026 none of the three reached goods already subject to Section 232 duties — clause 2 of every proclamation excluded them by name; the September 15, 2026 update below covers what changed.

Wine and spirits is the only product category this site prices under Section 338 — HTS chapters 2203 through 2208, annexed by Proclamation 11046. Dairy is in scope under Proclamation 11047, but this site carries no dairy category and does not price it. Through September 14, 2026, motor vehicles and their parts were carved out by law: HTSUS U.S. note 51(c) listed passenger vehicles, light trucks, medium- and heavy-duty vehicles, buses and all of their parts as "No change", and the Proclamation 11048 annex held no HTS 8703 or 8708 line at all — a Canadian vehicle or vehicle part paid its Section 232 duty and no Section 338 duty. The most important consequence for Canadian sourcing is that a USMCA preference claim does not defeat this duty. HTSUS U.S. note 51(a) subjects goods eligible for special tariff treatment under general note 3(c)(i) — which is how a USMCA claim enters — to the additional rate regardless, and the Rates of Duty 1-Special subcolumn reads "The duty provided in the applicable subheading + 50%", identical to 1-General. A USMCA-qualifying Canadian good in scope keeps its 0 percent preferential underlying duty and still owes 50 percent.

Section 338: 50% on Annexed Canadian Goods From August 22, 2026 (effective 2026-08-22). Three separate presidential proclamations, all signed July 20 and published July 23, 2026, each impose an additional 50 percent ad valorem duty on its own annexed list of Canadian goods under Section 338 of the Tariff Act of 1930 (19 U. Section 338 of the Tariff Act of 1930 (19 U.S.C. 1338) lets the President impose additional duties on the goods of a country that discriminates against United States commerce. It had gone unused for decades before three proclamations, all signed July 20 and published July 23, 2026, each applied it to a separate annex of Canadian goods: Proclamation 11046 covering alcoholic beverages, 11047 covering dairy, and 11048 covering a broad basket spread thinly across roughly 60 HTS chapters. Each imposes an additional 50 percent ad valorem duty on the goods in its own annex. The three were originally proclaimed for August 19, 2026; Proclamation 11056 (91 FR 54789) delayed the start by three days, so the duties actually apply to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on August 22, 2026. The reach is narrow in two directions: it is Canada-only, and within Canada it touches only annexed goods. Through September 14, 2026, an article already subject to Section 232 duties was excluded entirely, stated by name in clause 2 of all three proclamations; from September 15, 2026 (Proclamations 11064 and 11065, CBP CSMS #69851916) that exclusion narrowed to the dairy duty alone, so the alcohol and motor-vehicle-grievance duties now stack on top of Section 232. Through September 14, 2026, passenger vehicles, light trucks, medium- and heavy-duty vehicles, buses and all of their parts stayed off every Section 338 annex under HTSUS U.S. note 51(c); Proclamation 11065 then added two passenger-vehicle lines, 8703.10.50 and 8703.21.01, to the motor-vehicle-grievance annex, so a Canadian vehicle classified under either line now pays its Section 232 duty and the Section 338 duty on top of it. The consequence that matters most for Canadian sourcing is that a USMCA preference claim does not defeat this duty. HTSUS U.S. note 51(a) subjects goods eligible for special tariff treatment under general note 3(c)(i) — the route a USMCA claim takes — to the additional rate regardless, and the Rates of Duty 1-Special subcolumn reads "The duty provided in the applicable subheading + 50%", identical to 1-General. A USMCA-qualifying Canadian good in scope keeps its 0 percent preferential underlying duty and still owes the additional 50 percent. Wine and spirits, HTS chapters 2203 through 2208, is the only product category this site prices under Section 338; from 12:01 a.m. eastern time on September 29, 2026 the wine and spirits on the Proclamation 11061 annex, mostly limited to packaged forms, cannot be imported into the United States at all. Importers of annexed Canadian goods should confirm their HTS line against the proclamation annexes and check whether the good is subject to Section 232 — for the alcohol and motor-vehicle-grievance annexes that no longer removes it from Section 338, only from the dairy annex does it still remove it entirely.

Canadian sourcing is the only exposure here: Section 338 reaches annexed Canadian goods and nothing else. The practical checks are (1) whether your HTS line appears in one of the three proclamation annexes — for this site's categories that means wine and spirits, HTS chapters 2203 through 2208 — (2) whether the good is also subject to Section 232 duties: through September 14, 2026 that excluded it entirely under clause 2 of every proclamation, but from September 15, 2026 it only still does for the dairy annex, and (3) whether you have been budgeting on a USMCA claim, because this is the one authority a USMCA preference claim does not defeat: a qualifying good keeps its 0 percent preferential underlying duty and still owes the additional 50 percent. Most Canadian passenger vehicles, light trucks and their parts stay off every Section 338 annex, but two specific lines, 8703.10.50 and 8703.21.01, were added from September 15, 2026 and now owe the duty on top of Section 232.

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