Duties, Tariffs, and Import Taxes: What's the Difference?

If you’ve been following the news about the Supreme Court’s IEEPA ruling and wondering whether you’re owed a refund, you’ve probably noticed that the words “duties,” “tariffs,” and “import taxes” get tossed around almost interchangeably. Journalists, politicians, and even some trade professionals use them as if they mean the same thing.

They don’t. The differences are subtle but real — and when you’re filing for an IEEPA tariff refund, understanding the distinction between these terms helps you navigate the process and communicate clearly with your customs broker, trade attorney, and advisory team.

Let’s untangle them.

Tariffs: The Policy Tool

A tariff is a tax on imported goods, but it’s more accurately understood as a policy instrument. Tariffs are set by the government to achieve specific objectives — protecting domestic industries, generating revenue, retaliating against trade practices, or (as with IEEPA tariffs) addressing declared national emergencies.

How Tariffs Are Created

In the United States, the Constitution gives Congress the power to levy tariffs (Article I, Section 8). Congress has exercised this power in various ways over the centuries. Today, most tariff rates are set through legislation — primarily the Harmonized Tariff Schedule, which Congress periodically updates through trade bills.

But Congress has also delegated tariff authority to the President through various statutes:

The IEEPA tariffs were unusual because they used an emergency powers statute — the International Emergency Economic Powers Act — to impose tariffs. The Supreme Court ruled this was unconstitutional because IEEPA was never intended to regulate trade. That’s why those tariffs (and only those tariffs) are now refundable.

Tariffs vs. the Tariff Rate

When people say “the tariff on Chinese goods is 25%,” they’re referring to the tariff rate — the percentage applied to the customs value of the product. The tariff itself is the policy action (imposing a tax on imports from China); the rate is the specific number. This distinction matters because a single product can be subject to multiple tariffs at different rates — a normal MFN tariff plus a Section 301 tariff plus (formerly) an IEEPA tariff.

Duties: What You Actually Pay

While “tariff” refers to the policy or the rate structure, “duty” is the specific amount of money you pay to Customs and Border Protection when you import a product. Think of it this way: the tariff is the menu price, and the duty is your bill.

Types of Duties

Not all duties are created equal. Understanding the types helps you sort out what’s refundable and what isn’t.

Regular duties (MFN): These are the baseline rates in the Harmonized Tariff Schedule. They apply to most countries that have normal trade relations with the United States. When someone says “the normal duty rate on this product is 5%,” they’re referring to the Column 1 General rate. Understanding how import duties are calculated starts with these baseline rates.

Antidumping duties (AD): Additional duties imposed on products that are sold in the U.S. at less than fair market value. If a Chinese manufacturer sells steel pipe in the U.S. for less than it costs to produce (or less than the home-market price), the U.S. can impose AD duties to bring the price up to a “fair” level.

Countervailing duties (CVD): Additional duties to offset government subsidies in the exporting country. If China’s government subsidizes a manufacturer’s production costs, CVD duties neutralize that subsidy.

Section 301 duties: Additional duties on products from countries engaged in unfair trade practices. The Section 301 tariffs on Chinese goods (up to 25%) are still in effect as of 2026 and are separate from IEEPA.

Section 232 duties: Additional duties on products that threaten national security. The Section 232 tariffs on steel (25%) and aluminum (10%) remain in effect.

IEEPA duties: The additional duties imposed under executive emergency powers. These are the ones that were struck down and are now refundable.

Duty vs. Tariff in Practice

Here’s a practical example. Say you import stainless steel flatware from China. Your total duty payment might include:

• Normal MFN duty: 8.2% of customs value
• Section 301 duty: 25% of customs value
• IEEPA duty: 20% of customs value (now refundable)
• Total paid: 53.2% of customs value

In this scenario, you’d be eligible to recover the 20% IEEPA component — but not the normal duty or the Section 301 duty. The HTS codes on your entry summaries distinguish between these layers. HTS 9903 codes specifically identify the IEEPA component.

Import Taxes: The Broader Category

“Import tax” is the most general term. It encompasses all government-imposed charges on imported goods — duties, tariffs, fees, and excise taxes. In casual conversation, “import tax” and “tariff” are essentially synonymous. In technical usage, though, “import tax” can refer to charges that aren’t technically tariffs.

Fees vs. Taxes vs. Duties

When your goods clear customs, you might pay several types of charges beyond the duty itself:

Merchandise Processing Fee (MPF): A fee assessed by CBP on most formal entries. Currently 0.3464% of the customs value, with minimum and maximum caps. This is technically a fee, not a duty.

Harbor Maintenance Fee (HMF): A fee on imports arriving by vessel, equal to 0.125% of the customs value. Collected by CBP but administered by the Army Corps of Engineers.

Excise taxes: Some products (alcohol, tobacco, firearms, petroleum) are subject to federal excise taxes in addition to duties. These are collected by different agencies depending on the product.

None of these additional charges are part of the IEEPA refund. When we talk about IEEPA recovery, we’re specifically talking about the duty amounts assessed under the IEEPA executive orders — the charges coded under HTS 9903.01 and 9903.02 on your entry summaries.

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Why the Distinction Matters for Your IEEPA Refund

If you’re pursuing an IEEPA refund, the duty/tariff/tax distinction matters in several practical ways.

Calculating Your Refund Amount

Your refund is limited to the IEEPA duty component — not your total duty payment. If you paid $100,000 in total duties on a shipment and $40,000 of that was the IEEPA surcharge, your refund claim is for $40,000. The remaining $60,000 in regular duties, Section 301 duties, and fees stays with the government.

To calculate this accurately, you need to separate the IEEPA layer from everything else. Your entry summaries break this down line by line. Your customs broker can pull reports showing the IEEPA component specifically.

Talking to Your Broker and Attorney

When you’re working with your customs broker on filing a protest or post-summary correction, precision matters. Saying “I want a refund on my tariffs” is vague. Saying “I want to recover the IEEPA duties assessed under HTS 9903.01 codes on my entries from March through December 2025” is specific and actionable.

Similarly, when evaluating which recovery path to pursue, understanding that you’re recovering a specific duty component (not “all tariffs” or “all taxes”) helps you set realistic expectations for the refund amount.

Interest Calculations

When CBP refunds overpaid duties, they may include interest. But the interest calculation applies only to the duty amount — not to fees or other charges that aren’t part of the refund. Knowing exactly which charges are “duties” versus “fees” affects the interest amount you’re owed.

How Duties and Tariffs Work Together in the HTS

The Harmonized Tariff Schedule is where all of this comes together. It’s both the classification system and the rate schedule. Each HTS code maps to a specific duty rate, and additional tariff programs overlay additional rates.

Here’s how it looks on a real entry summary:

In this example, only Line 3 — the $10,000 IEEPA duty — is refundable. Lines 1 and 2 represent valid, enforceable tariff programs that the Supreme Court did not invalidate.

This layered structure is why understanding the HTS system matters for refund purposes. The HTS 9903 codes guide breaks down which codes correspond to which tariff programs, making it straightforward to identify the IEEPA component.

The Historical Context: Why These Terms Get Confused

The confusion between duties, tariffs, and taxes has deep roots. In the early years of the United States, tariffs were the primary source of federal revenue. There was no income tax until 1913. “Duties” and “tariffs” effectively meant the same thing because there was only one type of import charge.

Over time, the system became more complex. Congress created different tariff programs under different statutes, each with its own purpose and legal authority. Fees were added. Excise taxes were layered on. But the common vocabulary didn’t keep up. People still say “tariff” when they mean “duty” and vice versa — and in most contexts, that’s fine.

But in the context of an unprecedented multi-billion-dollar refund program, imprecision creates problems. The IEEPA refund is specific to duties imposed under a specific legal authority that was ruled unconstitutional. Conflating it with other charges leads to inflated expectations (“I want all my duties back”) or missed opportunities (“I didn’t think I paid any tariffs, so I didn’t file”).

For a broader look at how U.S. import tariffs work as a system, including the relationship between legislation, executive action, and enforcement, see our guide to how U.S. import tariffs work.

Duties, Tariffs, and Taxes in Other Countries

Since many importers also sell internationally, it’s worth noting that these terms have slightly different meanings in other jurisdictions.

In the European Union, the common external tariff applies uniformly to all goods entering the EU, regardless of which member state they enter. “Customs duties” in the EU context are similar to U.S. duties, but Value Added Tax (VAT) is also collected at the border — something that doesn’t happen with U.S. sales tax.

In Canada, “customs duty” refers to the tariff component, while the Goods and Services Tax (GST) is applied separately at import. The terminology is closer to the U.S. usage.

In China, import charges include customs duties, VAT, and consumption tax — each calculated separately and each with a different legal basis.

The key takeaway: if you’re a global business and you’re used to “import tax” meaning one lump-sum charge in another country, the U.S. system’s multi-layered approach (base duty + Section 301 + IEEPA + fees) can be confusing. But that multi-layered structure is exactly what makes it possible to refund one layer (IEEPA) while leaving the others intact.

A Quick Reference Guide

Here’s a cheat sheet to keep these terms straight:

Common Misconceptions About Duties and Tariffs

The confusion between these terms leads to several misconceptions that can affect how importers approach the IEEPA refund.

”All my tariffs are refundable”

This is the most common and most costly misconception. Only the IEEPA component is refundable. If you paid $500,000 in total duties and $150,000 of that was IEEPA, your refund is $150,000 — not $500,000. Overstating your claim doesn’t help and can invite scrutiny.

”I didn’t pay any tariffs because my broker handles everything”

You absolutely paid tariffs — your broker just handled the paperwork and payment on your behalf. The duties were assessed on your goods, charged to your account, and paid from your funds (even if your broker fronted the money and you reimbursed them). You are the importer of record and the party entitled to the refund.

”Tariffs are paid by the foreign country”

This is a common political talking point, but it’s economically wrong. Tariffs are paid by the importer of record — a U.S. company — to the U.S. government. The foreign manufacturer doesn’t pay a cent to CBP. In some cases, importers negotiate lower purchase prices to offset the tariff cost, but the tariff itself is a U.S.-to-U.S. transaction.

”Import taxes and sales tax are the same thing”

They’re not. Import duties/tariffs are federal charges collected at the border by CBP. Sales tax is a state-level charge collected at the point of sale. You can pay both on the same product — duties when it enters the country and sales tax when it’s sold to the end consumer. The IEEPA refund covers the federal duty component only.

What This Means for You

If you’re an importer who paid IEEPA tariffs between February 2025 and February 2026, you’re entitled to a refund of the IEEPA duty component — and only the IEEPA component. Understanding the difference between duties, tariffs, and taxes helps you:

1. Calculate your actual refund amount accurately (don’t include Section 301, Section 232, or normal duties)
2. Communicate precisely with your customs broker and advisory team
3. Set realistic expectations for recovery
4. Identify all qualifying entries by looking for the right HTS 9903 codes on your entry summaries
5. Understand the legal basis for why IEEPA duties are refundable while other tariffs aren’t

The IEEPA tariff refund glossary covers every technical term you’ll encounter during the recovery process. And if you’re still sorting out which of your entries qualify, the eligibility guide walks through the criteria step by step.

Don’t leave money on the table — but don’t overestimate your recovery either. Knowing exactly what you’re owed starts with understanding what you actually paid and under which authority it was collected.

Request a free Impact Assessment to get a precise calculation of your IEEPA tariff exposure. We’ll analyze your entry summaries, separate the IEEPA component from other duties, and recommend the best recovery path for each entry. The assessment is confidential, covered by mutual NDA, and delivered within 5-10 business days.