Rebuild every 2026 landed-cost model before you place another bulk toy order: the duty line is no longer zero. Based on the 2026 trade data available to us, Chinese-origin toys carry a combined 17.5% US tariff (7.5% Section 301 List 4A plus a 10% Section 122 tariff that took effect February 24, 2026), most other origins including Vietnam face 10% under Section 122, and Canadian-origin toys were hit with a 50% tariff imposed July 20, 2026 under Section 338 of the Tariff Act of 1930. US importers pay these duties — not the factory — so a $10 FOB unit from China lands with roughly $1.75 of duty before freight, and $1.00 from Vietnam. That single arithmetic difference decides whether you lock 2026 pricing at FOB, split the order across two origins, or push shipment timing past the scheduled Section 122 expiry around July 24, 2026.
Key Takeaways
- Origin now outweighs FOB price in most toy categories: on a $10 FOB unit, 17.5% China duty adds $1.75 per unit, while Vietnam or other Section 122 origins add $1.00 — a $0.75 gap per unit before any factory price difference.
- The duty is a buyer-side cost. US importers pay it directly, so DDP quotes must be re-checked line by line rather than assumed to be "duty included" at the old rate.
- Section 122's 10% layer is scheduled to expire around July 24, 2026. Treat that date as a planning scenario, not a guarantee — do not over-commit inventory on the assumption it disappears.
- Canada is no longer a duty-free backdoor: the July 20, 2026 Section 338 action applies to most consumer goods including toys, bypasses USMCA, and is based on country of origin, not shipping route.
- Ask for unit-cost reductions before raising MOQ. Diluting duty across a larger order only helps if the extra inventory actually sells; a lower unit price helps immediately.
What actually took effect in 2026
Three distinct US measures are in play for toy importers, and they do not share a deadline. First, the Section 122 tariff of 10% took effect February 24, 2026, and is scheduled to expire around July 24, 2026; for Chinese-origin plush toys it stacks on a 7.5% Section 301 List 4A surcharge for a combined 17.5% rate. Second, on July 20, 2026, the US imposed a 50% tariff on roughly $20 billion of Canadian imports under Section 338 of the Tariff Act of 1930, bypassing USMCA protections; toys are covered, with exemptions limited to energy, potash, critical minerals, fish, and Section 232 goods such as steel and aluminum. Third, Mexico-origin goods meeting USMCA rules of origin enter at 0% duty, though capacity for custom toy programs is limited.
Read those as three different statuses. Section 122's 10% is entered into force and applies to the covered categories. The Section 338 Canada action is entered into force and applies to toys. The July 24, 2026 expiry of Section 122 is scheduled, not confirmed by official text as a permanent repeal — treat it as uncertain. Rates in this environment have shifted repeatedly with little notice, so any number you model today should carry a re-quote trigger.
Who is responsible for what
The importer of record carries the legal duty liability, which is why the tariff shows up on your P&L and not the factory's. Your customs broker is responsible for filing the correct HS classification — toys generally fall under HS 9503, and sub-classification changes the duty line. The manufacturer's responsibility is documentation and product conformity: a Certificate of Origin showing goods wholly manufactured in the named country, and the safety evidence required for the destination market.
Keep duty and safety strictly separate. HS/tariff classification affects duty rates; it is not a safety certification, and a duty change does not change EN 71 or Toy obligations. Likewise, FOB, CIF, DDP and other Incoterms allocate trade responsibilities but do not certify the toy or replace CE, CPC, UKCA or other market evidence. If a supplier offers a DDP price "with everything covered," verify which of those two buckets they actually mean.
On the origin side, the obligation is documentary. A clean Certificate of Origin plus a bill of lading showing direct routing — for example Yantian or Shantou to Los Angeles or Long Beach with no Canadian transshipment — is what a customs review will ask for. Transshipment without substantial transformation does not change origin and creates penalty exposure.
What the procurement process must change
Rewrite the RFQ. Ask suppliers for FOB unit price, HS 9503 sub-heading, country of origin, and a separate line for any North American value-add. A lump-sum DDP figure hides the duty assumption, and you cannot renegotiate what you cannot see.
Model landed cost as FOB + duty + freight + surcharges + inland delivery, then compare that total across origins. Duty is the only component you can predict reasonably well; container rates and port congestion are not, so build a sensitivity band rather than a single number and hold a re-quote trigger if rates move before booking.
Split the compliance paper trail when you split the order. If one SKU is produced across factories or lots, the split should be visible in the order, carton code and compliance evidence — otherwise a customs or safety question on one lot contaminates the whole shipment record.
Reconsider MOQ math. Raising an order from 5,000 to 20,000 units does not reduce the duty rate; it just spreads a fixed duty across more units while adding inventory risk. On a $10 FOB unit, 17.5% duty is $8,750 at 5,000 units and $35,000 at 20,000 units. Ask for a unit-cost reduction first, then increase quantity only against confirmed sell-through.
Pilot before you commit. A 2,000–5,000 unit trial in Vietnam or Indonesia lets you compare quality, lead time and communication against your China base before moving a full program. For custom packaging, confirm the factory's minimum separately — open-mold plastic toys and custom packaging often carry different thresholds and should be quoted as such.
Time the calendar deliberately. Production commonly runs 25–35 days plus 7–10 days for custom packaging, so seasonal programs need confirmation well ahead of launch. If you are betting on the Section 122 expiry, schedule the decision point — not the shipment — around it, and keep a fallback origin quoted in parallel.
What remains uncertain
Whether Section 122 actually lapses around July 24, 2026 is not confirmed by official text as a permanent change; it is scheduled to expire and could be extended or replaced. Do not build a full-year buy plan on that single date.
The durability of the current China rate is also unknown. Tariff policy in this cycle has moved with little notice, and multiple US toy companies have challenged the measures in court — the outcome of that litigation was not confirmed in the material available to us. Treat 17.5% as today's planning number, not a 2027 forecast.
Freight-side specifics are the weakest part of the picture. We have no verified container rate, surcharge schedule or port congestion index for 2026 in the source material, so we will not quote one. Ship what you can quote: ask your forwarder for a named-port, named-sailing quote with the surcharge lines itemized, and note that any figure you get is valid for that booking window only.
Do not extend the plush-specific rates above to every toy category without checking. HS sub-classification and the applicable Section 301 list can differ by product, so confirm your own code with a customs broker before you re-price a catalog.
Obligation checklist by role
| Importer of record — duty payment | Pays the assessed duty (e.g. 17.5% China, 10% Vietnam/other Section 122 origins, 50% Canada). Verify: entry summary and broker duty calculation against the correct HS code and origin. Unknown: exact rate at a future entry date. |
|---|---|
| Importer of record — HS classification | Responsible for declaring the correct code; toys generally fall under HS 9503 with sub-classification affecting duty. Verify: broker's written classification rationale. Unknown: whether your specific sub-heading stays unchanged. |
| Customs broker | Files entry, classification and origin data. Verify: entry documents, Certificate of Origin on file, bill of lading showing direct routing. Unknown: nothing on timing. |
| Manufacturer / factory | Provides Certificate of Origin showing goods wholly manufactured in the named country, plus lot-level production records. Verify: origin certificate, carton codes, lot traceability. Unknown: whether a sub-supplier changes origin content. |
| Manufacturer — safety conformity | Holds the safety evidence required for the destination market; duty status does not change this. Verify: test reports and conformity documents per market. Unknown: category-specific requirements for new SKUs. |
| Distributor / retailer | Verifies product is supplied with valid market evidence; Incoterms allocate trade responsibility but do not certify the toy. Verify: conformity documents before listing. Unknown: none material. |
FAQ
Is the 17.5% China toy tariff still in force for 2026 orders?
As of the data available to us, yes — Chinese-origin plush toys face a combined 17.5% (7.5% Section 301 List 4A plus 10% Section 122 effective February 24, 2026). Confirm the rate and the applicable Section 301 list for your specific HS 9503 sub-heading with your customs broker before pricing, because rates in this cycle have changed with little notice.
Should I lock 2026 pricing now or wait for the Section 122 expiry?
Lock the pricing structure, not the full volume. Section 122 is scheduled to expire around July 24, 2026 but that is not confirmed as a permanent change by official text, so commit firm volumes only against confirmed sell-through and keep a re-quote trigger in the contract. If the 10% layer lapses, you want a documented mechanism to capture the reduction rather than a locked-in higher price.
How much more does a $10 FOB toy from China cost in duty than from Vietnam?
On the same $10 FOB unit, the China rate of 17.5% adds $1.75 per unit and the Vietnam/other Section 122 rate of 10% adds $1.00 — a $0.75 per-unit gap before any difference in factory price, freight or lead time. That gap is why a Vietnam pilot is worth running, but it is not proof Vietnam is cheaper overall; you must compare total landed cost.
Does raising MOQ reduce my tariff cost per unit?
No. Duty is charged on entered value, so a higher MOQ spreads the same percentage across more units while adding inventory risk. At 17.5% on a $10 unit, duty is $8,750 on 5,000 units and $35,000 on 20,000 units — the per-unit duty is unchanged. Negotiate unit cost down first; increase quantity only against confirmed demand.
Can I still route toy shipments through Canada or Mexico to reduce duty?
No — the Section 338 action applies based on country of origin, not shipping route, and transshipment without substantial transformation is illegal and creates penalty exposure. Mexico-origin goods meeting USMCA rules of origin do enter at 0% duty, but capacity for custom toy programs is limited and lead times are longer, so it suits selected programs rather than a mass-market shift.
What documentation should I request before booking a 2026 toy order?
Ask for a Certificate of Origin showing goods wholly manufactured in the named country, a bill of lading showing direct routing with no third-country transshipment, the HS 9503 sub-heading in writing, and the factory's market-conformity evidence. Keep duty and safety documentation in separate files — classification affects duty, not EN 71 or Toy compliance.
Sources
Request a Quote
Send us the SKU, target FOB price, destination port and expected annual volume, and we will quote across the origins that fit your category — with duty, freight and MOQ assumptions itemized so you can see what is locked and what is still variable. Tell us your decision point: lock 2026 pricing, split the order across regions, or shift shipment timing, and we will structure the quote accordingly.