In-Transit Tariff Exemption Doesn’t Apply to Air Shipments

By Rob Bates | September 16, 2025

It’s hard to play “beat the tariff” when the government keeps changing the rules.

After President Trump announced a slew of tariffs on April 2, many jewelry wholesalers loaded product onto airplanes to avoid the 10% global duty that would go into effect April 5. Some hoped they’d qualify for the “in transit” exemption, which says products aren’t subject to tariffs if they were on their way to America prior to the day tariffs were enacted.

At the time, those goods came into the country duty-free. However, Customs and Border Protection (CBP) announced on April 30 that the in-transit exemption applied just to goods transported by “water vessels,” not aircraft, as many believed. It also doesn’t apply to deliveries by rail or truck, or imports that use a final mode of transportation other than by sea.

As a result, starting in May, companies have received bills from Customs for 10% duties on air freight shipments they didn’t think they owed.

Sara Yood, president and CEO of the Jewelers Vigilance Committee, tells JCK, “Unfortunately, the Customs guidance that was only issued after the fact did clarify that the vessel exemption was only for goods on water transport—a change from what everyone expected and even what CBP was informally advising everyone at JFK Airport. It’s a super unfortunate situation that no one expected.

“Importers can file protests to challenge the Customs interpretation of this, and it could even end up in the Court of International Trade,” she adds.

Yet companies that file a protest still owe the money until the issue is settled.

JCK talked to the principal of one company that was billed 10% last week for a shipment that arrived in early April. While it wasn’t a big deal for the company—and the company’s shipper has indeed placed an appeal with Customs—this person worries about others.

“I’m hearing multiple firms are in the same boat—getting retroactive assessments tied to an ambiguous window and a late clarification,” the person says. “I suspect there will be a lot of U.S. retailers or manufacturers about to get some very unwelcome news.”

(Photo: Getty Images)