The United States modified the scope of Section 338 additional duties on Canadian imports effective 12:01 a.m. Eastern time on September 15, 2026. These changes affect goods entered for consumption or withdrawn from warehouse for consumption on or after that date. Day 2 of the modified scope: the September 15 changes remain in force, and a separate import ban on specified goods takes effect September 29 — approximately 13 days from now.
Importers and customs brokers handling Canadian origin goods must re-screen their SKU libraries and open purchase orders. The modifications added approximately 122 HTS classifications to headings 9903.03.12 and 9903.03.14 (the 50% additional duty), removed some classifications previously covered, and narrowed the zero-percent carve-out to heading 9903.03.13 only. For goods covered by the upcoming September 29 import ban (alcohol-related, dairy-related, and motorcycles per Proclamation 11063), this is the last window to clear Canadian-origin arrivals before the ban effective date.
This is an operational compliance guide. It is not legal or customs advice. Confirm HTS classification and duty treatment with qualified counsel and U.S. Customs and Border Protection before filing entries.
What changed on September 15
U.S. Customs and Border Protection implemented the scope changes announced by the White House on September 8, 2026. The modifications stem from two presidential proclamations (11064 and 11065) that adjusted the product lists underlying the original July 20, 2026 Section 338 actions on alcoholic beverages and motor vehicles. The stated rationale is to continue offsetting Canadian discrimination against U.S. commerce while better serving the public interest.
According to GHY International's September 2026 client alert, the modifications include:
- 122 classifications added under HTS headings 9903.03.12 or 9903.03.14 (both carry the 50% additional ad valorem duty)
- Certain classifications removed from coverage, including rock salt (HTS 2501.00.00), cement (HTS 2523.29.00), and two whisky categories (HTS 2208.30.60 and 2208.70.00)
- Zero-percent carve-out narrowed: as of September 15, only goods classified under HTS 9903.03.13 remain eligible to claim the 0% additional rate under HTS 9903.03.15; goods under 9903.03.12 or 9903.03.14 can no longer claim that relief
The full list of affected HTS numbers appears in the Annex of the Federal Register notices published September 14, 2026 (FR documents 2026-18838 for alcoholic beverages and 2026-18839 for motor vehicles).
Categories added to the 50% duty
New products covered include (partial list; see Annex I, Part A of the proclamations for the full detail):
- All-terrain vehicles and certain golf carts
- Additional dairy products, including cheeses not made from cow's milk (HTS 0406.90.99) and certain products under Chapter 4
- Certain paper products under HTS heading 4802
- Aluminum non-alloyed profiles, bars, rods (HTS 7604), and tubes and pipes (HTS 7608)
- Iron and steel columns (HTS 7308) and certain base metal fittings under Chapter 83
- Wooden and bamboo furniture under Chapter 94, plus electric tables and desks under Chapter 85
- Various motor vehicle and motorboat components
The modifications reach beyond the original dairy, alcohol, and motor vehicle themes. Importers across furniture, metals, paper, and light-vehicle sectors must re-evaluate Canadian sourcing.
Categories removed from the 50% duty
Products that are no longer subject to the additional duty as of September 15 include:
- Salt and pure sodium chloride (HTS 2501.00.00)
- Portland cement, other than white cement (HTS 2523.29.00)
- Certain whiskies and liquors previously under HTS 2208.30.60 and 2208.70.00
- Toilet paper and bedsheets made of paper pulp (select HTS codes under Chapters 48 and 25)
- Fishing rods (HTS 9507.10.00)
- Unwrought refined lead and certain switchgear assemblies
These exclusions do not apply retroactively. Goods entered before September 15 under the prior scope remain subject to the then-applicable duty.
The zero-percent carve-out is now restricted to 9903.03.13
Under the original structure, certain Canadian goods could claim a zero-percent additional rate under HTS 9903.03.15 if they qualified for one of the carved-out categories. As of September 15, that relief applies only to goods classified under HTS 9903.03.13.
Goods under HTS 9903.03.12 or 9903.03.14 can no longer claim the carve-out, even if they qualified before September 15. This change affects entry filings and landed-cost models. Brokers must verify which heading applies to each Canadian SKU and whether the zero-percent rate is still available.
According to C.H. Robinson's September 10, 2026 client advisory, the additional 50% duty stacks on top of any applicable Section 232 tariffs. USMCA qualification does not exempt goods from the Section 338 duty, though qualifying products still receive the USMCA preferential rate for ordinary customs duty purposes.
September 29 import ban: approximately 13 days remaining
In addition to the September 15 scope modifications, the White House announced that certain Canadian products will be excluded from importation beginning 12:01 a.m. Eastern time on September 29, 2026. As of today, September 16, that gives importers approximately 13 days to clear covered Canadian-origin arrivals before the ban takes effect.
The ban covers specified alcoholic beverages, dairy products, and motorcycles currently subject to the 50% duty. This is a separate action under Section 338's exclusion authority. Goods imported before September 29 but not yet entered for consumption by that date remain subject to the 50% duty, not the ban.
This is the last window for covered goods. Cargo arriving at U.S. ports after September 28 will not be admitted for consumption if it falls within the ban list. According to CBP CSMS #69606660 and reinforced in GHY International's client alert, importers with open purchase orders for banned products should accelerate in-transit shipments or arrange alternative sourcing now.
The September 15 scope modifications remain in force during this pre-ban period. Goods that entered on or after September 15 are subject to the modified HTS coverage and the 50% additional duty, while goods that arrive after September 29 and match the ban list cannot be entered at all.
For the import ban details, see Proclamation 11063 in the Federal Register (FR 2026-18837).
Re-screening checklist for importers
If your company imports Canadian goods, follow these steps before the next entry:
- Pull the HTS list from the CBP guidance (CSMS #69606660) or the GHY attachment showing all classifications now subject to 9903.03.12 through 9903.03.14.
- Cross-reference your SKU library against the 122 newly added classifications. Flag items that were previously duty-free or subject only to Section 232 and are now hit by the additional 50%.
- Re-calculate landed cost for any Canadian SKU that moved into or out of scope. The 50% additional duty is ad valorem and stacks on existing tariffs.
- Check carve-out eligibility for items you previously claimed under 9903.03.15. If the goods are now under 9903.03.12 or 9903.03.14, the zero-percent rate no longer applies.
- Update broker instructions before your next entry date. The September 15 effective date is by consumption entry or warehouse withdrawal, not by shipment or arrival.
- Review open purchase orders from Canadian suppliers. If HTS classification changes materially affect landed cost, commercial terms may need renegotiation or sourcing alternatives.
- Monitor the September 29 ban list separately. If your goods appear in the import exclusion annexes, plan for alternative sourcing or accelerate shipments that can clear before the ban takes effect.
USMCA does not shield against Section 338
One of the most important aspects of this action: goods that qualify for USMCA preferential tariff treatment still face the additional 50% Section 338 duty when covered. USMCA originating status provides the benefit of reduced or zero ordinary duty rates under the agreement, but Section 338 operates independently as a response to Canadian discrimination findings.
From C.H. Robinson's Section 338 blog post (August 2026): "A product may still receive the applicable USMCA preferential rate for its ordinary customs duty. But if that product is included in the Section 338 action, USMCA qualification by itself does not remove the additional 50% tariff."
This means an importer may file an entry with a USMCA claim for the base duty and simultaneously owe the 50% Section 338 duty on the same transaction. Classification and origin work remain essential, but they no longer guarantee duty relief.
Canadian counter-tariffs and two-way exposure
Canada announced retaliatory tariffs on specified U.S.-origin goods beginning September 8, 2026, with rates of 15%, 25%, and 50% depending on the product. Although those measures do not change U.S. import compliance obligations, companies with integrated North American supply chains face cost increases in both directions.
For U.S. exporters shipping to Canada, review the Government of Canada's countermeasure list for applicable tariff rates. For U.S. importers bringing Canadian goods, the September 15 modifications are the immediate compliance event.
The timeline: August 22 first wave, September 15 scope change, September 29 ban
Section 338 has moved in stages:
- July 20, 2026: Presidential proclamations 11046 (alcoholic beverages), 11047 (dairy), and 11048 (motor vehicles) announced the additional 50% duty
- August 22, 2026: The duties took effect after a three-day suspension ended
- September 8, 2026: White House announced scope modifications and import bans
- September 15, 2026: Scope modifications took effect (122 classifications added, carve-out narrowed, some items removed)
- September 29, 2026: Import ban on specified goods takes effect
These dates apply to entry for consumption or warehouse withdrawal, not to the date goods left Canada or arrived at a U.S. port. Goods in transit on September 14 that enter on September 15 or later face the modified scope.
Practical guidance for the next 30 days
The compressed timeline between announcement (September 8) and effective date (September 15) gave importers limited time to update systems. Those importing ATVs, newly covered dairy, furniture, aluminum profiles, or other added categories had less than one week to revise landed cost, adjust purchase orders, and instruct brokers.
Here is what operators should prioritize now:
- Entry review: If your company filed entries between September 15 and today under the old scope assumptions, reconcile them against the new HTS coverage. CBP may assess additional duty on goods you believed were excluded.
- Supplier communication: Notify Canadian suppliers whose products moved into scope. Landed cost changes may require renegotiation of Free on Board (FOB) or Delivered Duty Paid (DDP) terms.
- Alternative sourcing: If the 50% additional duty is not commercially viable, evaluate non-Canadian suppliers or U.S. domestic alternatives. The duty is not time-limited like some prior trade actions.
- September 29 decision: For goods subject to the upcoming import ban, decide whether to accelerate shipments that can clear by September 28 or to source elsewhere permanently.
The Bottom Line
Section 338 scope modifications effective September 15 changed the HTS coverage for Canadian imports subject to the additional 50% duty. Importers must re-screen their SKU libraries against approximately 122 newly added classifications, recalculate landed cost, and verify that goods previously eligible for the zero-percent carve-out still qualify. USMCA does not exempt covered products, and the duty stacks on top of Section 232 tariffs.
The timeline is tight: announcement on September 8, effective September 15, and an import ban on certain goods beginning September 29. Operators handling Canadian origin goods should pull the full HTS list from CBP guidance, cross-reference open purchase orders, and update broker instructions before the next entry.
For detailed HTS classification questions, consult the Federal Register annexes or your customs broker. For commercial strategy on Canadian sourcing, this is the moment to model landed cost under the new scope and decide whether to absorb the duty, renegotiate terms, or shift supply.
Sources cited:
- GHY International, "U.S. Imposes 50% Section 338 Tariffs on Canadian Imports..." (September 2026): https://www.ghy.com/trade-compliance/us-imposes-50-section-338-tariffs-on-canadian-imports-dairy-alcoholic-beverages-and-motor-vehicles/
- U.S. Customs and Border Protection, CSMS Message #69606660 (September 2026)
- Federal Register, "Modifying the Scope of Products of Canada Subject to the Additional Duties..." (September 14, 2026): https://www.federalregister.gov/documents/2026/09/14/2026-18838/modifying-the-scope-of-products-of-canada-subject-to-the-additional-duties-imposed-to-offset
- White House, "Modifying the Scope of Products of Canada Subject to the Additional Duties..." (September 8, 2026): https://www.whitehouse.gov/presidential-actions/2026/09/modifying-the-scope-of-products-of-canada-subject-to-the-additional-duties-imposed-to-offset-canadian-discrimination-against-the-commerce-of-the-united-states-with-respect-to-motor-vehicles/
- C.H. Robinson, "New 50% Tariffs and Import Ban on Certain Canadian Goods" (September 10, 2026): https://www.chrobinson.com/en-us/resources/insights-and-advisories/client-advisories/2026q3/09-10-26-new-fifty-percent-tariffs-and-import-ban-on-certain-canadian-goods/
- Federal Register, "Excluding Certain Canadian Products From Importation..." (September 14, 2026): https://www.federalregister.gov/documents/2026/09/14/2026-18837/excluding-certain-canadian-products-from-importation-into-the-united-states-in-response-to-continued