Updated September 2026
Tariffs changed so often in 2025 and 2026 that any article quoting a specific rate is out of date within weeks. So this version doesn't quote rates. It explains how tariffs and duties work for an online store, who pays them and when, and what Shopify can handle for you, so you can plug in today's numbers yourself.
The typical case: your product is made in China (or anywhere outside the US), it sits in your US warehouse, and you sell to customers at home and abroad. Here's what applies at each step.
Selling inside the US
Q: My stock is already in a US warehouse. Do tariffs still affect me?
Yes, but only once, when the goods enter the US. The importer of record (usually you) pays US duties when the shipment clears customs. The amount depends on the product's HS code, its country of origin and the rates in force on the day it enters. After that, selling it inside the US adds no further duty, just sales tax where it applies.
Q: Do I have to charge my US customers the tariff?
Not as a separate charge. Duty is part of your landed cost, the same as freight. What you do decide is how much of it goes into your retail price. Work out your landed cost per unit (product + freight + duty + fees), then check your margin at the current price before the next shipment lands, not after.
Q: What happened to the $800 duty-free limit?
It's gone for now. US Customs suspended duty-free “de minimis” treatment for goods from all countries from August 29, 2025, and in 2026 made the suspension indefinite. Low-value parcels shipped straight to US customers now owe duties like any other import. That hit dropshipping and direct-from-factory models hardest, because their whole model relied on every parcel being under the limit.
Selling to customers in other countries
Q: What decides the duty when I ship abroad?
The destination country's rules, based on three things you declare on the customs paperwork:
- What it is: the HS (Harmonized System) code.
- Where it was made: the country of origin. That's where the product took its final form, not where it shipped from.
- What it's worth: the declared value, and in many countries the shipping cost too.
Most countries also charge VAT or GST on imports, and carriers may add a brokerage fee. The EU also ended its duty-free threshold for low-value parcels in July 2026. We covered what that means for Shopify stores separately.
Q: My product is made in China but ships from the US. Which origin counts?
China. Customs goes by where the product was made, not where it was stored. The destination country applies its rate for Chinese-origin goods in that HS code. It doesn't add “US tariffs” on top just because the parcel left from the US.
Q: So will I pay duty twice?
Possibly, because it's two different countries' duties. The US duty you paid on import doesn't count towards the destination's duty. If you export a lot of imported stock, ask a customs broker about duty drawback, a US program that refunds certain duties on goods that are later exported. Not every duty qualifies, so check before you count on it.
Who pays: DDP or DAP?
This is the choice that matters most to your customer.
| DDP (Delivered Duty Paid) | DAP (Delivered at Place) | |
|---|---|---|
| Who pays duties and import taxes | You. You collect them from the customer at checkout | The customer, to the carrier, on delivery |
| What the customer sees | One total at checkout | A bill at the door |
| Risk | You carry any difference | Refused parcels, returns, chargebacks |
DDP is almost always the better experience. You'll also see the older term DDU for the customer-pays option; Shopify and most carriers now use DAP.
Q: Is my shipping agent or carrier responsible for the duties?
They're responsible for clearing the parcel, not for the cost. Carriers, freight forwarders and customs brokers often pay duties to customs on someone's behalf so the goods can move, then bill whoever the shipping terms name. That's you under DDP and the recipient under DAP, often with a brokerage or disbursement fee on top. The importer of record stays legally responsible for what was declared, so check your agent's paperwork rather than assuming they've got it right.
What Shopify can do for you
- Add HS codes and country of origin to every product. On each product, the Shipping section has Customs information with Country/Region of origin and Harmonized System (HS) code. You can search the HS field by keyword. Shopify's duty calculation relies on these fields. Without an HS code it falls back on the description and product category, and with none of those it can't calculate at all.
- Collect duties and import taxes at checkout. Go to Settings → Taxes and duties and click Manage under Duties and import taxes. Your store has to meet Shopify's requirements for this. Check them on that page.
- Buy DDP labels. When you've collected duties, Shopify Shipping sells DDP labels through its carrier accounts for DHL Express, DHL Express Canada, DHL eCommerce, and Canada Post (US destinations only). With other carriers, you can't buy a label in Shopify for an order where duties were collected.
- Or hand the whole thing off. Shopify Managed Markets, powered by Global-e, makes Global-e the merchant of record. It handles duties, import taxes and tax registration in the countries you sell to. It's available to merchants in the continental US and to some stores in Canada and the UK.
What counts as “Made in USA”?
Q: My product is made in China but packed or lightly assembled in the US. Does that change its origin?
No. Packing, labeling and simple assembly don't change the origin. For customs, origin shifts only when the product is substantially transformed into something with a new name, character and use.
Marketing claims have a stricter test. To label something “Made in USA” without qualification, the FTC requires it to be “all or virtually all” made in the US: final assembly, all significant processing, and nearly all components. A product can pass the customs test and still fail the FTC's.
Q: Can I use a different HS code to pay less duty?
No. Misdeclaring the HS code or the origin is customs fraud. Some products do legitimately fit more than one code, and a licensed customs broker can help you find the correct one.
A worked example (with made-up rates)
Plug your own numbers into this shape. Say you sell a $100 product to a customer in Germany and charge $25 shipping, the product's duty rate is 4%, and German VAT is 19%:
| Line | Amount |
|---|---|
| Product + shipping | $125.00 |
| Duty (4% of $100) | $4.00 |
| VAT (19% of $129) | $24.51 |
| Duties and import taxes | $28.51 |
With DDP, the customer pays $153.51 at checkout and nothing at the door. With DAP, they pay $125 to you and $28.51 plus any carrier fee on delivery. Real rules vary. Some countries apply duty to the shipping cost too, and the EU's new low-value duty works per tariff line, which is why letting Shopify calculate it is safer than a spreadsheet.
Takeaways
- US duty is paid once, on import, and belongs in your landed cost.
- Abroad, the destination country's rules apply, based on origin and HS code.
- Collect duties at checkout (DDP) wherever you can.
- Fill in HS codes and country of origin on every product you ship internationally.
- Rates change. Check current ones with your broker or carrier before you reprice.
If international shipping is new for you, our guide to Shopify's simpler shipping setup is the place to start.