Matcha Section 122 Import Duty 2026: Complete US Importer's Guide

The introduction of Section 122 import duty in February 2026 quietly reshaped the economics of every US-bound matcha shipment. Following the February 2026 Supreme Court decision invalidating IEEPA-based tariffs, the administration introduced a 10% global Section 122 import duty applied on top of the existing 6.4% base duty for green tea (HS 0902.20). Every 100 kg shipment of latte-grade matcha to the US now lands with USD 800–1,500 in additional duty cost compared to the pre-February 2026 baseline. US importers operating against pre-2026 landed-cost models are silently absorbing this cost; importers who understand the framework adjust pricing, contract terms, and sourcing architecture to manage it.

This guide is the 2026 Section 122 duty reference for US-based matcha importers — café chains, D2C brands, food manufacturers, and supplement companies sourcing matcha from Japan or any other origin. It covers the legal framework that introduced the duty, the specific HS codes affected, the calculation methodology, the documentation required for accurate filing, the strategic responses that absorb or pass through the cost, and the policy outlook through 2027 and beyond.

Key takeaways for Section 122 duty on matcha

• Effective date: February 2026, immediately following Supreme Court ruling on IEEPA-based tariffs.
• Rate: 10% on CIF (cost + insurance + freight) value.
• Applicable HS codes: 0902.10, 0902.20, 0902.30 (all green tea categories). Matcha typically falls under 0902.20.
• Combined rate: Base 6.4% + Section 122 10% = ~16.4% total effective duty on US-bound matcha.
• Cost impact: ~USD 800–1,500 added per 100 kg shipment of latte-grade matcha at typical 2026 pricing.
• Strategic response: Adjust US-market COGS modeling; consider DDP arrangements; evaluate cost-pass-through to retail pricing.

Table of contents

1. Background: how Section 122 came to apply to matcha
2. The legal framework
3. Applicable HS codes for matcha
4. Duty calculation methodology
5. Documentation and filing
6. Strategic responses for importers
7. Policy outlook 2027 and beyond
8. FAQ

1. Background: how Section 122 came to apply to matcha

Understanding the 2026 duty environment requires understanding the history that led to it.

2024–2025: IEEPA-based tariff regime

Beginning in 2024, the previous administration used the International Emergency Economic Powers Act (IEEPA) authority to impose broad import tariffs across multiple categories, including agricultural products. Matcha imports from Japan faced these tariffs at varying rates during the 2024–2025 period, with significant industry disruption as importers adjusted to the new cost structure.

February 2026: Supreme Court ruling

The Supreme Court ruled in February 2026 that the IEEPA-based tariff framework exceeded the statutory authority granted by Congress. The ruling invalidated the IEEPA-based duties immediately upon issuance.

February 2026: Section 122 introduction

Within days of the Supreme Court ruling, the administration announced replacement duties under Section 122 of the Trade Act of 1974, which provides for "balance of payments authority" to impose import surcharges. Section 122 authority is more explicitly granted by Congress and survives constitutional scrutiny that IEEPA-based duties did not.

The replacement Section 122 duty: 10% on CIF value, applicable globally to all imports including matcha and other agricultural products. The duty is in addition to existing base duties (6.4% for green tea HS 0902.20).

2. The legal framework

Section 122 authority

• Statute: Trade Act of 1974, Section 122.
• Purpose: Allows the President to impose temporary import surcharges "to deal with large and serious United States balance-of-payments deficits."
• Maximum rate: 15% under the statute. Current rate of 10% is below the cap.
• Maximum duration: 150 days under Section 122 alone, with extension subject to Congressional review.

Practical consequences for matcha

• Universal application: Applied to all countries of origin, not specific to Japan. Chinese-origin and other-origin green tea powders also subject.
• No exemptions for organic or specific tier: JAS Organic, USDA Organic, or any other certification does not exempt from Section 122 duty.
• Stacking with base duty: Section 122 duty applies on top of the existing 6.4% base duty for HS 0902.20.
• Currency: Calculated on USD-denominated CIF value at exchange rate at time of customs entry.

Distinction from previous regimes

3. Applicable HS codes for matcha

The Harmonized System (HS) classification determines which import is subject to which duty. For matcha and related green tea products:

Matcha-specific classification considerations

• Powder vs leaf: Both classified under 0902 as green tea; the "powder" form does not change classification.
• Stone-milled vs jet-milled: Same HS code regardless of milling method.
• Origin: HS classification is the same for Japan-origin, China-origin, or any other origin.
• Organic status: Different sub-codes (0902.20.10 vs 0902.20.90); both subject to Section 122 duty.

Mis-classification risks

• Classifying matcha under a non-tea HS code (e.g., food preparation): Misclassification; carries higher duty risk if discovered, including back duties and penalties.
• Splitting shipments to claim small-package classification: May or may not be acceptable depending on shipment structure; consult customs broker.
• Failing to disclose "contains tea" in composite products: Composite products (matcha-cocoa blend, matcha-protein powder) may be classified differently but still subject to component duties.

4. Duty calculation methodology

Step-by-step duty calculation

For a representative shipment: 100 kg latte-grade matcha at USD 75/kg FOB Japan.

Comparison: pre-2026 vs 2026

• Pre-February 2026: Same shipment landed at approximately USD 89/kg (CIF + base duty + fees + broker)
• Post-February 2026: Same shipment lands at USD 98.94/kg — an 11.2% effective increase to the importer's landed cost
• Annualized impact at 1,200 kg/year: Roughly USD 12,000 in additional duty cost per year

Calculation considerations

• CIF basis: Both base duty and Section 122 duty calculated on CIF value, not FOB. Higher freight = higher duty.
• Air vs ocean freight tradeoff: Lower ocean freight reduces CIF and therefore reduces duty. For lower-grade matcha where reefer ocean is acceptable, this is a meaningful saving.
• Insurance: Standard 1% of FOB+freight is typical; some importers insure at lower rates which reduces CIF.
• Currency: CIF computed in USD at customs entry exchange rate. Sustained JPY weakness gives lower CIF for yen-denominated invoices.

5. Documentation and filing

Section 122 duty is filed through the same customs entry system as base duties. Required documentation:

At customs entry

• CBP Form 3461 (Entry/Immediate Delivery)
• CBP Form 7501 (Entry Summary) — declares duty owed including Section 122
• Commercial invoice with HS code declaration
• Packing list
• Bill of Lading or Airway Bill
• FDA Prior Notice confirmation

Filing responsibility

• Importer of Record: Legally responsible for accurate duty declaration and payment.
• Customs broker: Typically files on behalf of the importer. Broker liable for filing accuracy but importer liable for final payment.
• Self-filing: Some larger importers self-file using ACE (Automated Commercial Environment) — requires CBP filer code and trained personnel.

Recordkeeping

• Customs entry records: 5 years from date of entry
• Commercial invoices and supporting documentation: 5 years
• FSVP records: 2 years (separate retention requirement)
• Duty payment records: 5 years

6. Strategic responses for importers

Importers have four main strategic responses to the Section 122 duty environment.

Response 1: Absorb the cost (no action)

• Approach: Accept the 10–11% landed cost increase as a non-pass-through cost; absorb in margin.
• When this works: Brands with strong gross margin headroom; products where pricing is sticky and pass-through risks customer churn.
• When this fails: Mid-margin operators where 10% landed cost increase materially erodes profitability.

Response 2: Pass through to retail pricing

• Approach: Adjust retail pricing to offset increased landed cost.
• Math: A retail product with 50% gross margin requires roughly a 5% retail price increase to fully offset a 10% landed cost increase (since cost is half of revenue).
• When this works: Premium-positioned products where modest price increases are absorbed by customer base.
• When this fails: Mass-market or price-sensitive products where 5% price increase causes meaningful demand decline.

Response 3: Reduce landed cost through Incoterms / freight optimization

• Switch from CIF to FOB: Manage your own freight to reduce freight markup; lower CIF means lower duty.
• Switch from air to reefer ocean (where grade allows): Reefer sea freight at USD 1.50–2.50/kg vs air at USD 5–12/kg significantly reduces CIF; duty savings can equal or exceed the freight savings.
• Consolidated freight via freight forwarder: For mid-size shipments, consolidated air freight can reduce per-kg freight cost by 15–20%.
• When this works: Importers with established freight relationships and grades that tolerate ocean transit (culinary and below).

Response 4: Switch to DDP arrangements with Japanese supplier

• Approach: Negotiate Delivered Duty Paid (DDP) with the Japanese supplier — supplier handles freight, customs clearance, and duty payment on behalf of buyer.
• How it works: Supplier becomes Importer of Record; manages Section 122 duty payment internally; bills buyer at all-in DDP rate.
• Advantages: Eliminates customs filing complexity; predictable per-kg cost; supplier may absorb some currency or duty risk.
• Disadvantages: DDP rate typically includes 10–15% premium over FOB-to-buyer-managed; FSVP responsibility unchanged for the buyer.
• When this works: Smaller importers without established customs broker relationships; importers prioritizing simplicity over cost optimization.

Combined strategy

Sophisticated 2026 importers typically combine responses: pass through 50% of the cost increase to retail pricing, absorb 25%, and recover 25% through freight or Incoterms optimization. The combined approach mitigates the Section 122 impact without single-lever overreliance.

7. Policy outlook 2027 and beyond

Section 122 duration

• Statutory cap: 150 days under Section 122 alone, with provisions for extension subject to Congressional review.
• Practical likelihood of extension: Depending on legislative dynamics; importers should plan as if duty will continue through 2026 at minimum.
• Possible alternative regimes: Section 232 (national security), Section 301 (trade remedies), or new IEEPA-equivalent legislation could replace or supplement Section 122.

Trade negotiation outcomes

• Bilateral US-Japan negotiations: Ongoing; matcha and other agricultural products are subjects of discussion.
• Possible exemption: If a comprehensive trade agreement reduces tariffs on Japanese agricultural products, matcha could see Section 122 duty reduced or eliminated.
• Timeline: Agricultural trade negotiations typically take 18–36 months; immediate relief unlikely.

Importer planning recommendations

• Plan 2026 budgets at 16.4% combined effective duty. Don't assume duty relief mid-year.
• Diversify origin mix. Section 122 applies globally; switching to non-Japanese origin doesn't avoid the duty. But it does protect against country-specific tariff spikes.
• Document any duty changes carefully. Section 122 rate could change with Congressional action; recordkeeping enables retroactive duty drawback claims if applicable.
• Monitor administration announcements. Trade policy shifts can happen quickly; importers benefit from attention to USTR and CBP announcements.

Optimize Section 122 duty impact with First Agri. DDP arrangements available for first-time US importers; FOB pricing for established importers preferring duty management; freight optimization advice for grade-appropriate shipping mode selection.

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FAQ

What is the US Section 122 import duty on matcha?

10% on CIF value, applicable to all green tea imports including matcha (HS 0902.20). Combined with the existing 6.4% base duty, total effective duty is approximately 16.4% of CIF value.

When did Section 122 duty take effect?

February 2026, immediately following the Supreme Court ruling that invalidated the previous IEEPA-based tariff regime.

Does Section 122 duty apply to organic matcha?

Yes. JAS Organic, USDA Organic, EU Organic, or any other certification does not exempt matcha from Section 122 duty. The duty applies to all matcha imports regardless of organic or conventional status.

Does Section 122 duty apply to matcha from China?

Yes. Section 122 is a global duty applied to all imports regardless of country of origin. Chinese-origin green tea powder and matcha are subject to the same 10% duty as Japanese-origin product.

Can DDP arrangements with my Japanese supplier eliminate Section 122 duty?

No — the duty still applies; the supplier just becomes responsible for paying it. DDP arrangements bundle the duty cost into the all-in per-kg price; the duty is still being paid, just by a different party in the chain.

How long will Section 122 duty remain in effect?

Uncertain. Section 122 has a 150-day statutory cap with extension provisions. Importers should plan for the duty to continue through 2026 and possibly beyond. Bilateral trade negotiations could lead to relief but timeline is 18–36 months minimum.

Related reading

• How to Import Matcha from Japan: 2026 FDA, EU, GCC Regulatory Deep Dive
• How to Buy Matcha Wholesale from Japan: Step-by-Step Guide for First-Time Importers
• Matcha Wholesale 2026: The Complete B2B Buyer's Guide to Sourcing from Japan
• FDA Requirements for Importing Matcha to the US: A Complete Compliance Guide
• Bulk Matcha Buying Guide 2026: MOQ Tiers, Shipping & TCO for B2B Buyers
• Matcha Wholesale Negotiations 2026: The Post-Shortage B2B Playbook

Optimize US matcha import economics with First Agri.

FOB and DDP options for US-bound shipments, freight optimization advice, and full Section 122 duty calculation support. Multi-origin sourcing under one supplier relationship to manage duty exposure across markets.

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