Uncertainty around tariff application and retaliation shakes global tea trade.
Canada and the European Union (EU) announced 25% retaliatory tariffs on specific United States imports to be enforced in early April. U.S. President Donald Trump immediately threatened to further escalate a global trade war.
The EU tariffs on $28 billion in U.S. goods, including shipments of Camellia sinensis, take effect on April 1. Canada was granted a month-long reprieve for goods that qualify for preferential treatment, but tea is among the goods targeted for a 25% tariff beginning April 2.
Shabnam Weber, president of the Tea and Herbal Association of Canada, writes, “Until April 2, all products from Canada that meet CUSMA/USMCA requirements have received a reprieve. Because the U.S. has moved forward with tariffs on steel and aluminum however, Prime Minister Trudeau said that he will not lift the 25% tariffs on the CAD $30 billion worth of goods he announced earlier. That means that tea (Camellia sinensis) coming in packed from the U.S. will be levied the tariff.
“I should emphasise that I have had extensive conversations with Global Affairs, and they define the packaging of tea as a substantial change, meaning that tea brought in bulk to the U.S., packed and then exported to Canada is a product of the United States and will therefore face a 25% tariff.”
Tea Association of the USA President Peter Goggi agrees, explaining that blending and packing tea from any country transforms its origin under provisions of U.S. Customs Regulations. “I am inclined to believe that the U.S. will apply a tariff after April 2nd, as the goods will be considered of Canadian origin,” he writes. It is unclear whether duties on tea shipped from China and packed in Canada would pay duties of 25% (Canada) or 27.5% (China) upon entering the United States.
“In all cases, we recommend that legal expertise be consulted,” he wrote via email.
U.S. tariffs on EU and Canadian steel and aluminum triggered the retaliatory tariffs on U.S. products. Tea, specifically HTS 0902, is among the tariffed goods, but a breakout of tea alone is not available because the EU groups tea, coffee, mate, and spices together in its export totals. Germany is the largest EU trading partner with U.S. Exports totaled at $18.5 million in 2024. The UK exported $19.6 million worth of tea to the US. Most of the $34 million worth of tea shipped to the U.S. from Canada last year arrived duty-free.
European Commission President Ursula von der Leyen said the tariffs are in proportion to the tariffs imposed by the United States, estimated to total around $28 billion. The bloc “will always remain open to negotiation,” she said.
Mexican President Claudia Sheinbaum said her government would wait until April 2 to decide whether to impose reciprocal tariffs on U.S. goods.
U.S. Threatens Reciprocal Tariffs
Retaliatory rates may increase when “reciprocal tariffs” are imposed on April 2.
Specifics have not yet been released by the White House or published in the Federal Register but will be determined based on existing import duties for tea, which vary by type and trading partner. Reciprocal tariffs may be increased to align with value-added taxes and export fees, ensuring that the total cost of exporting tea to any country is equivalent to the duties paid by U.S. wholesalers and retailers when importing tea from that country.
Tariffs on Chinese Tea
In 2018, the first Trump Administration increased duties on China's tea exports to 15% of their declared value, a rate that was reduced to 7.5% in 2020.
In February 2025, the second Trump Administration increased “country of origin” tariffs on Chinese goods by 10% to 17.5%. The rate is applied regardless of the shipping origin.
In response, on Feb. 10, China instituted countermeasures of 10% -15 % on non-ecommerce goods. On March 4, U.S. tariffs were further increased by 10%. Chinese tea imported into the U.S. is now subject to a 27.5% tariff. The rate for U.S. tea imported into China remains at 15%.
The most recent executive order increased tariffs on all tea from Canada, the EU, and China entering the country for consumption or withdrawn from a U.S. warehouse for consumption. Additional tariffs on tea shipped from other countries, including Japan, Kenya, Sri Lanka, and India, will be announced in April.
De Minimis Exemption is Dead
Previously, tea purchases under $800 were exempt from tariffs for China, Canada, and Mexico. The Section 321 “de minimis” exemption was revoked for all three countries on Feb. 4 but temporarily reinstated on March 10 to allow the Commerce Department to develop systems for processing and collecting tariffs on 1 billion low-value shipments. As of this writing, tea valued under $800 can be imported duty-free.
An analysis published on the Trade & Tariffs Hub concludes, “Enforcement is delayed, but once the CBP (U.S. Customs and Border Patrol) can process the volume, simply said, [Section] 321 for imports from China, Canada, and Mexico is dead.”