Section 122's 10% surcharge expired at 12:01 a.m. on July 24. The same morning, new Section 301 duties took its place on roughly 60 countries, covering 99.4% of U.S. imports. If you sell into manufacturing or distribution, the landed cost on nearly everything in your pipeline moved that day, whether anyone updated the quote or not.
That was three weeks ago. Long enough that the first wave of coverage has moved on. Not long enough for most order desks to have caught every open PO, every unacknowledged quote, and every shipment already in transit that's now carrying the wrong price.
Why this is an order entry problem, not a trade policy problem
Procurement and compliance teams have spent July reading proclamations. Order entry teams have a narrower, more immediate problem: every quote sitting in the queue and every PO that hasn't been acknowledged yet now has a price that might not match reality.
That mismatch shows up as three things. A stale quoted price no longer reflecting the new duty. A customer PO saying one number while your ERP, once it recalculates landed cost, says another. A change order that has to get issued, approved, and re-confirmed before the shipment can move. None of that requires a tariff attorney. It requires someone to catch the discrepancy before the order posts instead of after the invoice goes out.
What changed, and when
The short version: one temporary tariff expired, a permanent one replaced it the same day, and a separate action against Canada lands August 19.
Section 122: expired July 24
The temporary 10% surcharge on imports ended at 12:01 a.m. on July 24, 2026. That date was never in doubt: a 150-day limit was written into the statute from the start.
Section 301: the replacement, effective July 24
New duties tied to forced-labor findings now apply to roughly 60 economies at rates from 10% to 12.5%. Unlike Section 122, Section 301 has no built-in expiration. That's the difference between a surcharge everyone knew would eventually disappear and a duty structure that's now the baseline until further notice.
Brazil: a two-step stack to 37.5%
Brazil was hit twice. A country-specific 25% Section 301 duty took effect July 22, and the general 12.5% layer stacked on top of it two days later, bringing the total to 37.5% as of July 24.
Canada: 50% under Section 338, effective August 19
The first-ever use of Section 338 puts a 50% duty on covered Canadian goods starting August 19, 2026. The 50% headline overstates the breadth in one way and understates it in another. Coverage is limited to specific products, more than 550 tariff subheadings concentrated in motor vehicles, dairy, and alcohol, but it also reaches goods outside those three sectors. And USMCA certification doesn't exempt covered products the way it normally would. If you buy Canadian-origin motor vehicle components, alcohol, or dairy inputs, that's the detail that will surprise your finance team on August 19 if nobody flags it before then.
One more detail: entry date, not order date or ship date, determines which rate applies. A brief carve-out spared goods loaded before July 24 and entered before July 28, but that window has closed. Two identical orders from the same customer can owe different duty depending on which side of July 24 the entry falls on. That's not a policy nuance. It's the exact kind of detail that has to live in a validation rule, because no order desk employee is going to remember it order by order.
Where this breaks in the order entry process
The stale quoted price
A quote sent on July 20 with pricing calculated under Section 122 is now wrong. If that quote converts to a PO after July 24 and nobody re-checked the landed cost, the order posts at the wrong price and someone eats the difference. Usually the seller, because it's easier to absorb than to explain to the customer after the fact.
The PO-to-ERP mismatch
This is the one that shows up in the order entry queue. The customer's PO reflects the price they were quoted. Your ERP, if it's recalculating landed cost correctly, now shows something different. Someone has to catch that gap, figure out which number is right, and resolve it before the order ships, not after the customer gets an invoice they weren't expecting.
The change order
Goods that were in transit when the rate changed need a change order to correct pricing, and change orders mean re-approval, re-confirmation, and a customer conversation nobody wants to have twice in one quarter. Multiply that by however many open orders were sitting in the pipeline on July 24, and it's a lot of manual rework for a problem that had nothing to do with your product or your customer relationship.
How validation rules catch this before it posts
This is exactly the kind of exception Y Meadows was built to flag automatically instead of relying on someone to notice it. When an order comes in, the system checks the price on the PO against the price your ERP expects today, not whatever the quote said three weeks ago. If those numbers don't match, the order gets flagged for review instead of posting straight through.
The same logic that catches a contract discount a customer forgot to apply catches a tariff rate that changed since the quote went out. It doesn't matter whether the discrepancy comes from a pricing error or a duty structure that didn't exist a month ago. The rule doesn't care what caused the mismatch. It catches it before the order posts and before anyone has to unwind an invoice.
That's the difference between finding a pricing problem in a Tuesday morning review of the exception queue and finding it three weeks later when a customer calls asking why they were billed more than the PO said.
FAQ
What happens to open purchase orders when tariff rates change?
The rate that applies depends on the entry date, not the date the PO was written or the order was shipped. Transition carve-outs sometimes protect goods already on the water for a few days, but once those close, an open PO written before a rate change and entered after it owes the new rate. The originally quoted price may no longer be accurate.
How do distributors handle price discrepancies between a customer PO and their ERP?
The reliable approach is catching the mismatch at the point of order entry, before the order posts, by comparing the PO price against the price the ERP expects rather than relying on someone to remember which orders were quoted under the old rate.
Who absorbs a duty increase on goods already in transit?
That depends on the contract terms between buyer and seller, but the practical problem is the same either way: someone has to identify which in-transit orders are affected and issue a change order before the goods land, not after.
What to do this week
Pull every open quote and unacknowledged PO issued before July 24 and check it against current landed cost. That single pass will catch most of the exposure sitting in your pipeline right now, before it turns into a change order, a margin surprise, or a conversation with a customer that starts with "why does this invoice look different from the quote."
And if you'd rather not repeat that exercise by hand every time rates move, order validation rules can run the check on every PO automatically, starting the day the rules change.
Frequently Asked Questions
The rate that applies depends on the entry date, not the date the PO was written or the order was shipped. Transition carve-outs sometimes protect goods already on the water for a few days, but once those close, an open PO written before a rate change and entered after it owes the new rate. The originally quoted price may no longer be accurate.
The reliable approach is catching the mismatch at the point of order entry, before the order posts, by comparing the PO price against the price the ERP expects rather than relying on someone to remember which orders were quoted under the old rate.
That depends on the contract terms between buyer and seller, but the practical problem is the same either way: someone has to identify which in-transit orders are affected and issue a change order before the goods land, not after.