US Tariffs on Textiles & Fabrics

What This Covers

The textiles and fabrics surcharge covers cotton fabrics, synthetic fibers, yarn, textile raw materials, and woven or knitted fabrics classified under HTS chapters 50-60. The base tariff rate for textiles averages around 9%, placing this sector among the more heavily taxed categories at the base level. USMCA yarn-forward rules of origin require that yarn be produced in North America for finished textile products to qualify for duty-free treatment. After the Supreme Court struck down IEEPA reciprocal tariffs on February 20, 2026, all textile-exporting countries now face a uniform 10% Section 122 tariff (effective February 24, 2026, expiring ~July 24, 2026).

Most Affected Countries

China remains the most penalized textile exporter due to Section 301 surcharges stacking on top of the 10% Section 122 tariff and the 9% base rate. India, the second-largest textile source for the US market, benefits from the drop to a uniform 10% Section 122 rate, which is lower than its former country-specific IEEPA rate, reducing costs across cotton textiles, synthetic fabrics, and specialty materials. Vietnam and Bangladesh are the most dramatic beneficiaries — their IEEPA rates of 46% and 37% respectively have collapsed to a uniform 10%, reviving the competitiveness of these countries in the global textile supply chain virtually overnight.

How Surcharges Stack

Chinese textiles face a 9% base rate plus 25% Section 301 surcharges plus the 10% Section 122 tariff, for combined rates of approximately 44%. Indian cotton textiles face the 9% base rate plus the 10% Section 122 tariff, totaling 19% — a substantial reduction from the old regime where India's IEEPA rate had pushed the combined burden significantly higher. Vietnamese fabrics now face the 9% base rate plus only 10% Section 122, totaling 19% — compared to approximately 55% under the old 46% IEEPA rate. Bangladesh sees an identical improvement, with total duties dropping from roughly 46% to 19%. USMCA-qualifying textiles from Mexico enter duty-free if they meet the yarn-forward rule, which requires North American yarn, limiting the pool of qualifying products. Section 122 expires around July 24, 2026.

Sourcing Strategies

The uniform 10% Section 122 rate has restored competitive balance across Asian textile suppliers, eliminating the distortions that had made some countries prohibitively expensive while others remained accessible. Importers should still evaluate USMCA yarn-forward qualification for duty-free treatment from Mexico, which may require restructuring supply chains to source North American yarn. Vietnam, Bangladesh, India, and Indonesia all now face the same 10% Section 122 rate, so textile buyers can optimize for fabric quality, lead times, and minimum order quantities rather than tariff avoidance. With Section 122 expiring around July 2026, textile importers negotiating seasonal purchasing agreements should build in pricing adjustments that account for a potential drop to base-rate-only duties.