Section 232 Reduction June 2026: Agricultural, HVAC, and Mobile Industrial Equipment Cut from 50 to 15 Percent
Presidential Proclamation June 1 2026 reduced Section 232 tariffs on certain agricultural, HVAC, and mobile industrial equipment from 50 to 15 percent, effective June 8 2026 through December 31 2027. Here is the HS code coverage, country eligibility, USMCA mechanism, and worked landed-cost examples.
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Open calculatorSection 232 Reduction June 2026: Agricultural, HVAC, and Mobile Industrial Equipment Cut from 50 to 15 Percent
The Presidential Proclamation issued June 1 2026 reduced Section 232 tariffs on certain agricultural, HVAC, and mobile industrial equipment from the standard 50 percent to 15 percent, effective June 8 2026 and running through December 31 2027. For importers in these categories the reduction is the largest single-step Section 232 relief of the second Trump administration.
This guide covers the HS code coverage, the country eligibility for the cap, the USMCA mechanism, and worked landed-cost examples for the most common equipment lanes.
The two reduction tracks
The proclamation contains two distinct relief mechanisms in different annexes.
Annex III: Agricultural and HVAC equipment
Specific HTSUS subheadings for agricultural and HVAC equipment are added to Annex III. The Section 232 rate on these subheadings drops from 50 to 15 percent through December 31 2027 regardless of country of origin. Categories include:
- Tractors and related machinery (HTSUS chapter 8701)
- Construction and material-handling machinery (HTSUS 8429)
- Agricultural machinery and parts (HTSUS 8432 and 8433)
- HVAC equipment (HTSUS 8415)
The exact subheading list is in Annex III of the proclamation. Importers should verify their specific 8-digit HS subheading is in the annex before claiming the reduced rate.
Annex I-C: Mobile industrial equipment, with country and USMCA conditions
Mobile industrial equipment and machinery identified in Annex I-C is subject to two distinct caps depending on origin.
For imports from any of the following countries, the maximum Section 232 rate is 15 percent: Argentina, Ecuador, El Salvador, Guatemala, Japan, the Republic of Korea, Liechtenstein, Switzerland, Taiwan, the United Kingdom, or the European Union.
For USMCA-qualifying products from Canada and Mexico, the 25 percent rate applies only to the non-US content of the product. The total tariff cannot fall below 15 percent.
Worked example: tractor from Brazil
A 200,000 USD CIF tractor (HTSUS 8701.94, agricultural tractor over 130 kW) imported from Brazil. Brazil is not in the Annex I-C country list, but tractors fall under chapter 8701 which is covered by Annex III (no country restriction).
| Layer | Pre-June 8 rate | Post-June 8 rate |
|---|---|---|
| MFN under WTO | 0 percent | 0 percent |
| Section 232 | 50 percent = 100,000 | 15 percent = 30,000 |
| Section 122 reciprocal (through July 24) | 15 percent (anti-stack vs 232, applies on non-232 layer only, effectively 0 here) | Same |
| MPF capped | 614.35 USD | 614.35 USD |
| HMF ocean | 0.125 percent = 250 | 250 |
| Total | 100,864.35 | 30,864.35 |
Pre-June 8 effective rate on the tractor: 50.4 percent. Post-June 8: 15.4 percent. Savings on this single shipment: 70,000 USD.
Worked example: HVAC unit from Mexico (USMCA qualifying)
A 50,000 USD CIF rooftop HVAC unit (HTSUS 8415.81, air conditioning machine over 5 kW). USMCA-qualifying with 65 percent US-content per the producer's USMCA certificate.
HTSUS 8415 is in Annex III, so the country and USMCA carve-outs of Annex I-C do not bind. The flat 15 percent post-June 8 rate applies.
| Layer | Pre-June 8 rate | Post-June 8 rate |
|---|---|---|
| MFN under WTO | 1.4 percent (specific to 8415.81) = 700 | 700 |
| Section 232 | 50 percent = 25,000 | 15 percent = 7,500 |
| Section 122 (USMCA exempt) | 0 | 0 |
| MPF capped | 173.20 (0.3464 percent of 50k) | 173.20 |
| HMF ocean | 62.50 | 62.50 |
| Total | 25,935.70 | 8,435.70 |
Post-June 8 savings: 17,500 USD on a single 50k shipment.
Worked example: mobile industrial equipment from Korea (Annex I-C, country cap)
A 100,000 USD CIF mobile forklift (HTSUS 8427.20, self-propelled forklift, in Annex I-C list per the proclamation). Korea is in the Annex I-C country list, so the 15 percent cap applies.
| Layer | Pre-June 8 rate | Post-June 8 rate |
|---|---|---|
| MFN under WTO | 0 percent | 0 percent |
| Section 232 | 50 percent = 50,000 | 15 percent = 15,000 |
| Section 122 reciprocal (through July 24) | 15 percent on full value, anti-stack means 0 on Section 232 base | Same anti-stack treatment |
| MPF capped | 346.40 | 346.40 |
| HMF ocean | 125 | 125 |
| Total | 50,471.40 | 15,471.40 |
Post-June 8 savings: 35,000 USD on a single 100k shipment.
What this changes for importers
Audit your current Section 232 entries against the Annex III and Annex I-C HS subheading lists. Many importers paying 50 percent on covered equipment after June 8 are over-paying and have refund standing via post-summary correction.
The USMCA mechanism is per-shipment and per-product specific. The 25 percent on non-US content with a 15 percent floor only helps if your producer can document the US-content calculation. Without the USMCA certificate, the standard 25 percent on full value applies.
Coordinate timing with the Section 122 sunset. For agricultural and HVAC importers, June 8 cut the duty stack by 35 percentage points. July 24 will cut another 15 percentage points (Section 122 sunsets by statute). Stacked effect on a 100k shipment: 50 thousand USD less between June 7 and July 25 compared to the May 2026 rate.
Country diversification math has shifted. Pre-proclamation, sourcing tractors from Brazil vs Korea was roughly indifferent on Section 232. Post-proclamation, Brazil (Annex III, flat 15 percent) actually beats Korea (Annex I-C, capped at 15 percent only with country eligibility documentation) on simplicity.
Citations
- Proclamation June 1 2026 (effective June 8 2026): see USTR and White House sources
- CBP CSMS instructions June 5 2026: https://www.cbp.gov/trade/programs-administration/csms
- Holland and Knight analysis: https://www.hklaw.com/en/insights/publications/2026/06/annexed-opportunity-proclamation-provides
- Global Trade Alert June 2026 update: https://globaltradealert.org/blog/s232-metals-update-june-2026
- International Trade and Supply Chain Insights summary: https://www.internationaltradeinsights.com/2026/06/president-trump-reduces-section-232-tariffs-on-certain-agricultural-mobile-industrial-and-hvac-equipment/
- Green Worldwide Shipping operational guide: https://www.greenworldwide.com/section-232-tariff-reductions-for-agricultural-hvac-and-mobile-industrial-equipment-effective-june-8-2026/
Run the post-June 8 stack on your equipment
The LandedFees calculator will pick up the reduced Section 232 rate automatically for the Annex III and Annex I-C subheadings once the country and HS overlay tables are updated (expected within the week). In the interim, model the reduction manually as 15 percent in lieu of 50 percent on your covered HS lines.
Frequently asked questions
What changed on June 8 2026?
Presidential Proclamation issued June 1 2026 reduced Section 232 tariffs on certain agricultural equipment, HVAC equipment, and mobile industrial equipment from the standard 50 percent to 15 percent. The reduction took effect June 8 2026 and runs through December 31 2027. CBP CSMS instructions for entry were published June 5 2026.
Which HS codes are covered?
The reductions apply to specific HTSUS subheadings listed in Annex III (agricultural and HVAC) and Annex I-C (mobile industrial) of the proclamation. The categories include tractors (HTSUS 8701 series), construction and material-handling machinery (8429), agricultural machinery (8432 and 8433), HVAC equipment (8415), and selected mobile industrial machinery. Verify your specific HS subheading against the Annex lists before claiming the reduced rate.
Which countries qualify for the 15 percent cap?
For mobile industrial equipment in Annex I-C imported from Argentina, Ecuador, El Salvador, Guatemala, Japan, the Republic of Korea, Liechtenstein, Switzerland, Taiwan, the United Kingdom, or the European Union, the maximum applicable Section 232 tariff will not exceed 15 percent. Agricultural and HVAC reductions in Annex III apply without country limit.
How does the USMCA mechanism work?
For USMCA-qualifying products in Annex I-C, the 25 percent Section 232 rate applies only to the non-US content of the product, calculated under the standard USMCA value content rules. However, the total tariff applicable cannot fall below 15 percent. So a 60 percent US content tractor pays 25 percent on the 40 percent non-US content, which works out to 10 percent of full value, which is then floored up to the 15 percent minimum.
Does this affect the Section 122 sunset on July 24?
Section 232 and Section 122 are separate programs and the June 2026 reduction does not touch Section 122. Section 122 still sunsets July 24 2026 by statute. For agricultural and industrial equipment importers, the June 8 Section 232 cut combined with the July 24 Section 122 sunset is the largest two-step duty reduction of 2026.
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