Nicaragua Tariffs Spike for Rights Abuses: U.S. Trade Pushback
Published Date: 12/29/2025
Notice
Summary
The U.S. is taking action against Nicaragua because of unfair labor and human rights practices that hurt American businesses. Starting January 1, 2026, tariffs on Nicaraguan products will increase, with more hikes in 2027 and 2028. This means imports from Nicaragua will cost more, aiming to push for better treatment of workers and respect for the law.
Analyzed Economic Effects
5 provisions identified: 1 benefits, 4 costs, 0 mixed.
Phased Tariff Increases on Nicaragua
Imports from Nicaragua that are not originating under CAFTA-DR will face additional duties phased in over three years: 0% for goods entered on or after January 1, 2026, 10% for goods entered on or after January 1, 2027, and 15% for goods entered on or after January 1, 2028.
Existing AD/CV Duties Still Apply
Products of Nicaragua covered by the new HTSUS heading 9903.89.01 will continue to be subject to antidumping, countervailing, or other duties, fees, exactions, and charges that already apply to those products.
CAFTA-DR Originating Goods Exempt
Goods of Nicaragua that are originating under the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) are not subject to the additional duties imposed by new heading 9903.89.01.
Chapter 98 Entry Exceptions and Duty Rules
The additional duties do not apply to goods properly claimed under most provisions of chapter 98 of the HTSUS, except for entries under subheadings 9802.00.40, 9802.00.50, 9802.00.60, and heading 9802.00.80; for those subheadings the additional duties apply to the value of repairs, alterations, or processing performed abroad or to the value of the article less the U.S. content as described.
Foreign-Trade Zone Admission Restriction
Any product covered by the Annex that is subject to the additional duty and admitted into a U.S. foreign-trade zone on or after January 1, 2026, may only be admitted as 'privileged foreign status' and will be subject upon entry for consumption to applicable ad valorem rates of duty or quantitative limitations.
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