UK to USA shipping in 2026

Tariffs

Tariffs are a long established tool countries use to leverage their own industrial might, innovation or consumer spending power. They are a form of tax levied by a country typically on goods being imported. If someone wants to limit the number of a particular type of good coming into their country, they can put up the tariff and hopefully reduce the quantity being imported which leaves room for their own domestic producers to thrive. Here in the UK its usually focused on meat and dairy to try to protect our british farms.

 

HS Codes

Tariffs are applied to products using a device called a HS Code or more fully the Harmonized Commodity Description and Coding System. Phew! Unhelpfully there are a few varieties of these. An HS Code is a 6 digit universal identifier (like your cell phone number) that is unique to a product type. These are universally recognised and used across the world.

There are in fact 10 digit identifiers for most products, but not every country uses these.

The USA actually uses a version of the HS Code called an HTS or Harmonised Tariff Schedule. This is one of those 10 digit codes and is based on the 6 digit HS Code followed by an additional 4 digits set by the USA and used to provide a deeper classicification and to identify the specific rate of duty which is to be applied. Still with me?

For example:

A generic wool pullover has the following HS Code: 6110.11

While to import it into the USA you would need to specify which type of pullover it is:

Mens Wool Sweater: 6110.11.0015

Womens Wool Sweater: 6110.11.0080

There are many more classifications even just for pullovers. There are as you can imagine tens of thousands of HTS codes and using the wrong ones can get you into bother when it comes to paying tariffs and identifying products if shipments are being inspected.

 

 

Duty

The duty is the simple name for the tax that is applied to the goods being imported. You buy a $100 sweater, it has 10% duty applied – so the sweater actually costs you $110. In practice the duty is set for all the different HS Codes that a country might deal with.

 

Tariff Rates

To give you some random examples of the Tariff Rates set by the USA against some goods you might want to import…

Mens Wool Sweater: 6110.11.0015 is treated as 16%

Squash Rackets: 9506.59.80.40 are treated at 4%

Salt & pepper Shaker: 6911.10.41 00 are treated at 6.3%

If you are not sure, you can search them all here on the US Harmonised Tariff Schedule: https://hts.usitc.gov/

Tariff Rates are sometimes referred to as an MFN Tariffs or MFN Rates – Most Favoured Nation Rate. Thats how we know it and how youll see it referred to later in this document.

 

Most Favoured Nation (MFN)

MFN Status is an agreement between countries that they will offer each other the best Tariff Rate available – so if country A offers country C a better Tariff Rate on a particular item, Country B automatically benefits as well. The MFN Rate is applied where there is no preferential trade agreement in place i.e. Free Trade Agreement. While the USA and UK are both under the MFN agreement the USA has placed a 10% “reciprocal” Tariff on top of the MFN Rate on UK goods – more on this later…

 

Customs Declarations

This is a monster area and we wont try to cover it all as frankly it would be impossible and full of mistakes, but… When an item arrives in the US with the Customs and Border Protection they have to know what the parcel contains. This is usually an electronic Customs Declaration, though sometimes these are physical print outs stuck to the side of boxes.

The Customs Declaration has to contain some key elements or the shipment simply wont be accepted by the US CBP. This includes country of origin, reason for export/import, name of the importer, HTS Codes, value of the goods, weight etc. Your vendor should include all of this detail on the Customs Declaration when they mail it to you, but clearly in 2025 that was a major issue as everyone’s system had to adjust. There is also significantly more scrutiny on international shipments these days, where before parcels were only occasionally inspected now far more work is being doing by US CBP to verify the goods arriving are what they say they are.

In our own case when we raise a shipment on DHL, Fedex or Royal Mail their website asks us to fill in all of these essential details and creates the Customs Declaration for us in a format the US CBP can follow. It is also possible to create your own Customs Declarations and to upload these or include them with the shipment – but we have been wary of doing this as it can create its own issues.

 

Classification

As the exporter we are responsible for declaring what the goods are and allocating their HTS Codes. If you had a look on the US Harmonised Tariff Schedule link above you will see how complex these product classifications can be and there is a major exercise for any new vendor to work out exactly what their products are and how they fit into the HTS Code framework.

Luckily for us at Bill Baber Knitwear we only have about 15 classifications for products – wool pullovers for men, wool pullovers for women, silk jackets for women etc. If you are a vendor shippping hundreds of varied product types from coffee cups to earings then this is a huge task and it is easy to make mistakes.

In practice some of these classifications are pretty wild and getting it right is important as the resulting Tariff Rates can be very different.

A ladies wool overcoat actually is charged as follows:

55.9¢/kg + 16.4% – note there is an additional charge based on the weight of the product here.

If the overcoat is made of cotton then its only charged at 15.9% and there is no additional tariff based on the weight of the goods.

By contrast a suit-type jacket or blazer made of synthetic fibre is FREE! Whats the difference between an overcoat and a jacket I hear you say? Well its open to interpretation.

So vendors have to be careful to map their product range accurately or they may be costing you a lot of duty you didnt need to pay. Arguably there is also an opportunity in here for businesses to design a collection based on what duties might be liable. Polyester Blazer anyone?

 

$800 De Minimis

De Minimis is a shorthand for a rule that has been in place for hundreds of years and essentially allows governments to provide a duty free route into their markets. The one we are interested in was an $800 threshold provided to US importers allowing them to bring in less than $800 per day of goods and not pay any duty on them. Its the system that allows you to do some ecommerce shopping for a gift and not have the sting in the tail of paying complicated tariffs. It massively simplified the whole international shipping system protecting consumers from dealing with Customs Declarations and HS Codes.

However – all through the $800 De Minimis era your vendor was still making up Customs Declarations and all the HS Codes and Tariff Rates were in place – you maybe just didn’t need to pay them and didnt notice it was happening unless a box went missing or an incorrect duty invoice was raised!

This duty free loop hole is contentious, and certainly ‘bricks and mortar’ retailers in the US have been exposed to their customers simply going online to find cheaper alternatives they can import direct from Europe, China or elsewhere. Temu, Shein and others were in the spotlight last year for exactly this kind of practice.

The same loop hole has however been a powerful tool for small retailers to import goods made overseas which are simply not available in the USA – like sweaters made in Scotland or Irish ceramics and arts.

Chances are if you have been buying product from Bill Baber Knitwear over the last 15 years, you will have been using this loop hole – whether you realised or not! We took your orders and divided them for you into $800 chunks such that no duty would need to be paid. We then staggered these out by a few days to prevent you recieving more than $800 on a single day. Its more work for us both certainly, but saves a lot of cash which can instead be lavished on more Squash Rackets and Pepper Shakers!

Under the De Minimis…

$799 worth of wool jumpers = $0.00 of duty

while $800 worth of the same jumpers =  $128.16 of duty

So for decades small retailers and artisan vendors have saved countless millions in duty while the larger retailers and exporters have been paying duties this whole time. In our own case it has been invaluable in allowing us to support the Celtic market in the USA with affordable Scottish made imports.

As explained the De Minimis was removed by Executive Order back in July 2025, though a vestige of it remains in the form of the International Postal Network $800 limit.

 

Splitting Shipments vs Paying Duty

This is an important calculation and will vary depending on the product. In this example we are just looking at wool pullovers which before 2025 would attract duty of 16% based on the US HTS Code.

For most of the last ten years our average shipping cost to the USA has hovered around 8% of the cost of the goods. So the $800 De Minimis parcel we send over would have about $64 worth of shipping on top.

If we had $8000 worth of goods to be delivered in large boxes or on a pallet then this might have dropped down slightly to 6% – maybe $480 of shipping.

The difference is the duty.

We have an $8000 order of wool sweaters to deliver. We need to do the math before deciding how to ship it for you…

10 lots of parcels each worth less than $800 and each using the De Minimis is $0 duty, but $640 of shipping (10 x $64 each). Thats an order total of $8640.

$8000 in one big box is going to draw down $1280 worth of duty as the single shipment is worth more than $800 and thats going to costs around $480 worth of shipping. Thats $1760 of combined shipping and duty or an order total of $9760

So the total cost to split the shipping into $800 chunks would have saved you $1120 – thats a huge number.

OK – If we were posting heavy glass vases then the shipping cost might be higher to allow for the safety packaging etc – so each vendor would have his/her own calculations to make. In fact we just ran the numbers on a live quote for DHL and the shipping alone was going to be $1300 which is much more than the $480 in the example above! Big savings.

 

Incoterms

One of the building blocks of international trade is the use of Incoterms or International Commercial Terms. These are a list of 3 letter codes that set out who is responsible for various aspects of import/export. You might recognise FOB (Free on Board) or EXW (Ex Works).

 

DAP vs PDDP

DAP stands for Delivered at Place and is the general set of terms applied to most orders before 2025. Delivered at Place means that the goods arrive into the USA without any duties having been paid yet.

Tyically the vendor sends a parcel using Fedex. The parcel arrives into a Fedex warehouse in the USA. US CBP know the parcel has arrived and wants the duty paid – this is where your customs declaration comes in. Because the goods are sent under the DAP Incoterm, Fedex contact the recipient and ask for payment of the duty bill. You pay the duty, US CBP authorise the arrival into the USA and Fedex can deliver your lovely box full of knitted hats and scarves.

If the parcel was worth less than $800 then no duty was even due, and US CBP can simply authorise the delivery. No one is waiting for payment.

DAP can be a low cost option as some of the admin and all the duty is covered by the recipient – you are not paying your vendor or the shippping agent to do the work for you. BUT if the recipient missed the email from Fedex asking for the duties to be paid (check your spam filters please) then your parcel could be held up for days while everyone tried to sort it out.

DDP stands for Delivered Duties Paid – in this instance the shipper bears all the responsibility for the costs of duty. The parcel arrives into the same Fedex warehouse. US CBP know the parcel has arrived and wants the duty paid. Because the goods this time are sent under the DDP Incoterm, Fedex now bills the vendors account – they don’t need to contact the recipient. With the duty paid US CBP can quickly release the goods and Fedex can deliver them. It’s a much smoother process and should be quicker for all involved – but Fedex have paid the duty on account for the sender and usually charge a small premium for doing it. Any cost here gets passed on to the recipient when they are paying their invoices for the goods. DHL for example used to charge us $25 a shipment if we were using the DDP terms, we would have to bill that on to you.

If you are paying a Landed Price – typically its a DDP service you have been using and all of these associated costs are being worked into the item’s price. It saves a lot of admin, but you are paying for it.

PDDP is a new one for 2025 and we will come on to it later but it stands for Postal Delivered Duties Paid and it is a solution created in response to The White House shaking up how international postage is going to be working from here on. Essentially it forces the duty to be paid before the goods reach the warehouse in the US. Any parcel arriving without the duty already paid will be held in a storage area and penalties and warehousing fees will be charged until the duties are paid. It’s the wild west in there – no fun for anyone.

 

IEEPA

The International Emergency Economic Powers Act (IEEPA) first came to light for us on this side of the Atlantic as a series of sweeping reforms of US and Worldwide trade in Febuary of 2025 (thats 12 months ago!). In essence these are tools to enable the US Government to declare a state of emergency as a result of some foreign activity – in this case the illegal imports of Opiods into the US. Last thing we want to do is be entering into politics and we dont want to weigh in on this – just treating it as a fact of what we are facing.

Under the IEEPA framework a series of emergency “reciprocal” tariffs were introduced on the Rose Garden outside the White House in what is commonly referred to as Liberation Day. In that announcement a new worldwide Tariff Rate was set to 10% with a host of much higher rates for many countries. These tariffs were set to correct a perceived imbalance in global trade and came as a huge shock to many of us working in this industry.

Initially the effect was to lay large tariffs on goods coming in from countries like China and Mexico – many shipments already in the air or on the water were affected and the rules on origin suddenly became hugely important.

These new tariffs are commonly called IEEPA Tariffs or your IEEPA Rate. There was some initial confusion as to how they were to be applied, in fact there is still plenty of confusion and indeed discrepancy in how they are applied in practice. In fact these new rates were IN ADDITION to the pre existing MFN Tariffs that were already in place.

Your 16% wool pullover suddenly had a 10% IEEPA rate added on top.

 

Spring 2025

While things were hugely disrupted by the introduction of the IEEPA rates on some countries, goods made wholly in the EU and UK were only lightly affected. The new rates of 10% on UK and 15% on EU were in effect – but we also still had access to the $800 De Minimis and many businesses were still able to trade at a low level. The surprise duties were mostly being felt in supply chains where the product was originating in China and the disruption caused by many businesses being suddenly surprised that their goods were not actually of UK or EU origin.

 

Where is my shipment?

As all of these shipments were hitting the USA and the US CBP was being asked to investigate extra shipments, the whole system creaked and parcels started being held up in warehouses while they were sorted out. A lovely extra charge was also levied in some cases where the recipient was contacted to pay duties and queried the amount or flat out refused to pay! As the shipment was on hold, shipping agents were billing importers and exporters for the time the parcel spent in their warehouse – basically charging rent while the dispute was in place. We heard stories of disputed packages being returned thousands of miles to sender or being destroyed as unwanted goods.

 

The Executive Order

The relative calm for UK exporters (haha) was thrown into disarray when in July of 2025 the White House issued an Executive Order to remove the $800 De Minimis. Effective August 28th of 2025 the loophole that many of us have relied on for so many years came to an end and suddenly duties were to be applied on all goods arriving no matter how small the shipment or where the goods had been made. Executoive Order 14324 can be read in full here

 

US Warehousing

Just a short note on this one as its becoming more common. Some brands are shipping bulk quantities of goods into the US and storing them in warehouses ready for distribution thoughout the US. This massively reduces the complexity for the supply chain as large shipments can be passed through US CBP in one go rather than dealing with each order going to each store one at a time. However this practice can be open for abuse and there are very strict rules in place for making sure that goods are not brought in under valued to save on duties. Doing so is a breach of 19 U.S.C. 1401a – you can read all about it here.

 

Ad Valorem vs Fixed Rate

These terms became significant and need explanation. Basically Ad Valorem refers to a duty or tax calculated based on a percentage. So your 16% Tariff Rate on $100 worth of wool pullovers is an Ad Valorem calculation resulting in $16 of duty. $1000 dollars worth of goods the Ad Valorem increases and the duty is now $160

The Fixed Rate calculation is a simplified method where you might get a $0.50 tax on a bottle of cola or a flat rate charged on each purchase. This is sometimes referred to as a Specific Rate. If the Cola costs $2 and has a fixed $0.50 tax on it, then even if the Cola increases to $3 the tax stays the same.

Ad Valorem calculations result in larger taxes as the goods increase in value, while a Fixed Rate stays the same no matter the value of the item.

 

 

International Postal Networks and Fast Parcel Carriers

In the very same Executive Order issued in June of 2025 the White House identificatied distinct routes into the US market and how duties were to be handled in each.

1. The Fast Parcel Network – This is a group of international carriers that you would recognise and includes Fedex, UPS, DHL etc.
2. The International Postal Network – This is the group of usually domestic mail companies that include Royal Mail, An Post, Deutsche Post etc.

With the removal of the De Minimis an enormous number of parcels arriving into the US CBP now needed to be assessed and duty charged on each. It has been estimated at 4 million parcels per day, sadly not all are from Bill Baber Knitwear. There was reasonable scepticism that the system coould handle this new influx and as such some mechanisms were introduced to help mitigate the strain.

1. Parcels using the Fast Parcel Network (DHL, FEDEX) would be billed using the Ad Valorem duty calculation and would now result in duties being charged at the MFN Rate + the IEEPA Rate for the country from which the goods originate.
2. Parcels instead using the International Postal Networks (Deutche Post, Royal Mail) and worth under $800 could make use of a “Specific Duty” or Flat Rate scheme. This was a 6 month scheme that was due to end in Febuary of 2026. If the goods arriving originated from a country with an IEEPA rate of less than 16% (thats UK and EU) then a single parcel would be billed at a Flat Rate of $80. This could rise to $200 per parcel based on where the goods were originating from.
3. Parcels using the International Postal Network (Deutsche Post, Royal Mail) and worth less than $800 could instead make use of the Ad Valorem duty calculation (this is where each item is allocated its own duty according to its HTS Code) – but only if the duty was pre paid before the goods arrive in the US. In this method only the IEEPA rate is applied, the MFN Rate is not used. This is huge news.

As you can see while the old $800 De Minimis was removed, there was a new shadow version of the De Minimis created – parcels arriving through the International Postal Network worth less than $800 could make use of it and if the duty is pre paid then you dont pay the IEEPA + MFN you are only liable for the IEEPA rate.

Currently that rate is set to 10% on goods originating in the UK.

 

PDDP Rides to the Rescue

We mentioned this Incoterm earlier – basically it’s the new scheme where a shipping agent is able to pre pay the duty on parcels before they arrive into the USA. This means that the parcel and the goods satisfy the 3rd example given in the Executive Order above and the MFN Rate is not due, only the IEEPA Rate.

Here in the UK our International Postal Network is the Royal Mail and they very quickly (the same weekend as the Executive Order) launched the new PDDP service on their website. It has been a huge help and potentially saves importers a significant amount of duty.

 

An example for 2026

Earlier we ran you through an example of how Splitting Shipments vs Paying Duty compared before the events of 2025. Below an example under the new Tariff regime which is in place at time of writing.

DAP via Fedex

You have an order for $799 of goods. The parcel contains wool pullovers made in the UK.

If we mail this via Fedex we would expect your shipping to be approximately 8% or $64ish

Because we are using the Fast Parcel Network and the goods are below $800 you are paying the MFN Rate plus the IEEPA Rate. Thats 16% + 10%. or $208ish

If you choose to mail the goods DAP then you’ll get a bill for the duties from Fedex when the parcel arrives in the USA for the $208iish but they will also charge you a small processing fee for this service, and you may even have a small handling charge billed by US CBP on Fedex and billed back to you – this might add up to another 5% or $40ish

So all in we are looking at $799 goods + $64 shipping + $208 duties and + $40 handling. Thats $1111 all in. For $799 of goods.

If you went for the DDP method and asked us to get Fedex to bill us instead, we would likely have an additional $25 charge from Fedex to put in there.

 

PDDP via Royal Mail

We have the same $799 of goods.

Shipping via Royal Mail is a little higher, it’s around 10%. call it $80ish.

Because we are using the International Postal Network we dont have to worry about the 16% MFN Rate, we are only due the 10% IEEPA Rate. Thats $79.90

Because we are using the Royal Mail we can use the PDDP method, theres a charge for this – its $0.67 flat rate. For the whole parcel, not per item.

So all in here we are looking at $799 goods + $80 shipping + $79.90 duty + $0.67 of handling. Thats $959.57 – saving us $150 vs the Fedex option above.

 

Both of these examples are simplifications – we chose a typical case featuring one of our most common products made here in the UK. Maybe the goods you are importing have much cheaper shipping rates, and perhaps the MFN Rates for those items are much lower than the 16% then perhaps the result flips and the Fedex route is cheaper. You would need to run these examples with your own supply chains.

 

Big brands wont split shipments

Totally understandable that the vendor supplying you with $100,000 of socks each year isn’t prepared to split your order down into $800 chunks. It is certainly more work and takes admin time that many companies don’t want to give up or can’t offer. However if you are working with UK or EU brands where the order totals are more manageable then its worth asking the question. These changes might present an opportunity for smaller brands and retailers to thrive in this market if they can be given a chance.

 

 

Rules on Origin

This one is a can of worms.

The country where the goods are imported from isn’t the same as where they are considered to originate from. Origination is a legal definition handled differently by each country.

If you buy a sweater from a lovely business in Scotland, but it was actually made in China – well its of Chinese Origin. When the US CBP take a look at your Customs Declaration they will use the Statement of Origin to decide which Tariff Rate to apply.

As you know from the IEEPA Tariffs introduced on Liberation Day the UK is only 10%, EU is 15% most of the rest of the world has much more punishing Tariff Rates attached – so its important the Origin is clearly understood when you are ordering your goods.

 

Substantial Transformation

Goods typically contain both raw materials and labour. Depending on what it is you might have some expensive component parts but cheap labour. But its the labour element here which is significant.

If the sweater you are importing was knitted & finished in China using Scottish wool – its considered to be of Chinese origin. The labour element in the production was done in China.

If the sweater was knitted & finished in China, using Scottish wool, with Scottish leather shoulder pads, using labels and printed swing tags from Scotland and all by Scottish knitters and finishers living in China – guess what? Its still considered to be of Chinese origin. Thats where the labour element is being done.

The very simple common sense approach when looking at any product is to work out where the bulk of the manual labour was done. This understanding is at the core of the Rule of Origin for most countries including the USA. It is sometimes called “Substantial Transformation” and is designed to catch out anyone who is taking in product from one country and sewing in a tag from another saying something vague like “Designed in Scotland” or “Inspired by Ireland”.

Sadly its incredibly common in our industry for this sort of practice to be going on and the earthquake caused by the White House in 2025 brought a lot of it to the fore as suddenly product was arriving into the US and the origin was visible – not hidden behind the De Minimis which really didn’t care where the goods came from.

On a Customs Declaration the sender has to clearly mark the Origin of the goods. They are making a formal declaration to US CBP that the goods are substantively of that country and if they are found to have misrepresented the origin then stiff penalties might be applied.

 

Made in Scotland

If the labels, wool, leather shoulder pads and swing tags come from China, but the garment is knitted and finished in Scotland – then it’s of Scottish Origin. The component parts were “Substantially Transformed” in Scotland and thats how the duty will be calculated.

In our case we buy wool from Australian, Chinese, Scottish and New Zealand sheep – it is then cleaned, spun and dyed in the EU or UK. We use linen from flax grown in Europe before being spun and dyed this time in Spain. Our cotton comes from a global market with producers in warm climates including China and India. Sadly these plant fibres dont grow in Scotland – though we used to buy a lot of Irish Linen when that was possible.

Our swing tags are printed on card from sustainable forests in the EU. The plastic bags we use come from a manufacturer in the UK, though the polymers used in their production is unknown – we will have to check. The labels we sew in are indeed printed and woven outside Europe, sometimes in Vietnam.

However all of the knitting is done on our own workshop or studio right here in Edinburgh – it always has been and always will be. Yes we use large industrial knitting machines instead of hand knitting everything, but it still takes a0 knitter to operate. Consider it the difference between someone hand sewing or using a sewing machine – they are different skills but no less artisan.

We also do all of our finishing right here in Scotland with a very small team of highly skilled individuals known as linkers. A linker takes knitted fabric panels and joins them together on a linking machine to make a finished jumper. These days an automatic knitting machine can knit you a sweater from start to finish – we have zero interest in that and are focused on continuing to produce Scottish made knitwear. In fact in 2025 we launched a range of knitwear that is 100% Scottish! Scottish wool, knitted and finished in Scotland.

In short our products are and always have been Made in Scotland

Posting goods to the USA in 2026

Hope you made it this far. This really isn’t an easy topic and this document itself took many days to draw together. To try to conclude where we are and how we are going to be handling orders for your going forward read on…

Until further notice we will be using the Royal Mail’s Pre Delivery Duty Paid (PDDP) Service. If you request an alternative method, then of course we will do our best to follow that.

Under this scheme you should expect duties to be charged at 10% if the following criteria is met.

• All goods in the parcel must be of UK origin
• Each parcel’s value must be below $800
• The duty must be pre paid

We have been using this system since it was launched in August 2025. To test it out initially we sent test parcels to some of our stockists in the US and were delighted when these arrived in a timely fashion and with no unexpected costs! So far we have had no issues with orders being delayed, being held up in customs or any costs that we had not anticipated. Touch wood – things are working well.

In practice a Royal Mail parcel takes 5-7 days to arrive where before under the UPS/Fedex route we saw more like 2-3 day deliveries. It’s only fair also to mention that if something were to go amiss we would have a harder time resolving things with the Royal Mail than we would have with a courier like DHL. As such we would remind you that the goods belong to us until they arrive on your doorstep. As such if they go missing or are delayed in transit – we have to replace them at our cost. You shouldn’t have to shoulder responsibility for any lost shipments – though your patience while we reknit anything is of course welcome.

 

Thank You

We’ll continue to monitor the situation and will keep this page updated as and when there are any changes. Do let us know if you have any questions at all by emailing info@billbaber.com – we have learnt a lot over the last year and are happy to share any and all knowledge!