Before the world started talking about trade wars every single morning, the trade relationship between the U.S. and China was, well, relatively quiet. If you look back at 2017, the average tariff on Chinese goods was tiny. We're talking about 2.7%.
That’s basically a rounding error compared to the double and triple-digit numbers we see in the headlines today.
Most people think tariffs were always a huge wall. Honestly, for decades, they were more like a small speed bump. The U.S. operated on a philosophy of "engagement." The idea was simple: if we trade more, China becomes more like a Western market economy. That didn't exactly pan out as planned, but it explains why those rates stayed so low for so long.
How much were China tariffs before Trump and why were they so low?
To understand that 2.7% figure, you've got to go back to 2001. That was the year China joined the World Trade Organization (WTO). Before that, Congress had to vote every single year to decide if they’d keep trading with China on friendly terms. It was a massive political circus every time.
Once China got "Permanent Normal Trade Relations" (PNTR) status, those annual fights stopped. The U.S. committed to giving China the same low tariff rates it gave almost every other country. These are called Most-Favored-Nation (MFN) rates.
The MFN Era (2001–2017)
During this stretch, if you were importing a plastic toy or a pair of sneakers from a factory in Shenzhen, you were likely paying next to nothing in duties. Most consumer electronics—laptops, cell phones, monitors—actually carried a 0% tariff under the Information Technology Agreement.
It wasn't a total free-for-all, though. The U.S. did have "trade remedy" laws. If a U.S. company could prove that a Chinese competitor was "dumping" products (selling them below cost) or receiving unfair government subsidies, the Department of Commerce could slap on specific duties.
For example, the Obama administration famously put a 35% tariff on Chinese tires in 2009. They also targeted Chinese steel and solar panels. But these were surgical strikes. They only affected a tiny sliver of the hundreds of billions of dollars in trade flowing across the Pacific.
The Shock to the System
Everything changed in early 2018. The first "real" move wasn't even specifically about China—it was the Section 201 tariffs on washing machines and solar panels. But then came the big guns: Section 301.
The U.S. Trade Representative (USTR) put out a massive report claiming China was stealing intellectual property and forcing American companies to hand over their tech secrets. That was the legal justification used to hike rates.
The Numbers Started Climbing Fast
By the end of 2018, that 2.7% average had already jumped to over 12%. By early 2020, after several rounds of escalation, the average tariff on Chinese imports hit 19.3%.
Think about that for a second. In just two years, the cost of bringing Chinese goods into the U.S. increased more than sevenfold.
What about the "Phase One" Deal?
You might remember the "Phase One" agreement signed in early 2020. People thought it would reset everything. It didn't. While it lowered some rates (like cutting a 15% tariff down to 7.5% on certain goods), it left the bulk of the tariffs in place.
Actually, as of 2024 and 2025, many of those rates have only gone up. The Biden administration kept the Trump-era tariffs and even added new ones on "strategic" sectors like electric vehicles (100% duty) and semiconductors.
Comparing Then and Now
If you’re trying to visualize the difference, look at this breakdown of the average effective rates:
- 2017 (Pre-Trade War): 2.7%
- 2019: Around 15%
- 2023: 19.3%
- Early 2025: Spiked briefly toward 125% during negotiations before settling back down.
By mid-2025, after some wild "tit-for-tat" escalations where rates reached over 100%, the U.S. and China eventually negotiated a 90-day "pause" with a temporary reciprocal rate of 10%. But even that "low" negotiated rate is nearly four times higher than the pre-Trump era.
Why This Matters for Your Wallet
When tariffs were 2.7%, companies usually just absorbed the cost. It was a cost of doing business. But when you move to 25% or 100%, that's impossible.
The money doesn't come from China. The U.S. importer—the company bringing the stuff in—pays the bill to U.S. Customs. To keep their profit margins, they usually pass that cost to you. That’s why your toaster, your bike parts, and your holiday decorations have all gotten more expensive over the last few years.
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Actionable Insights for Navigating Today's Trade Landscape
If you're a business owner or a curious consumer, here is how to handle the "new normal" of high tariffs:
- Check the HTS Code: Don't assume everything from China has the same rate. Use the Harmonized Tariff Schedule to find the exact code for your product. Some items still fall under "List 4" or have specific exclusions that might save you money.
- Look into "Country of Origin" Shifting: Many companies have moved final assembly to Vietnam, Mexico, or India. If "substantial transformation" happens in a third country, you might avoid the China-specific Section 301 duties. Just be careful—Customs is getting very strict about "transshipment" (just moving a box through another country without changing the product).
- Use De Minimis (While You Can): Historically, shipments under $800 entered the U.S. duty-free. This is how Shein and Temu became so huge. However, as of late 2025, there are massive pushes in Congress to close this "loophole" for Chinese imports, so don't build a long-term business model around it.
- Audit Your Supply Chain: Diversification is the only real hedge. Even if you love your Chinese supplier, having a "China Plus One" strategy (a backup factory in another region) is no longer optional—it's a survival requirement.
The era of 2.7% tariffs is gone. It was a specific moment in history fueled by a belief in globalism that has mostly evaporated. Whether you agree with the current "trade war" or not, the data shows we are living in a completely different economic world than we were a decade ago.