Facing heightened tariffs imposed by the current U.S. administration, many businesses are turning to the ‘First Sale Rule’ as a strategic way to lower import expenses. This provision allows import duties to be calculated based on the price paid in the first sale of goods destined for the U.S., rather than the final sale price, potentially lowering the taxable amount.

By structuring transactions to take advantage of this rule, companies can legally minimize tariff expenses, enhancing competitiveness and preserving profit margins. This strategy has gained traction amid heightened trade tensions and increased duties on goods from countries like China.

However, the application of the First Sale Rule requires meticulous documentation and compliance with U.S. Customs and Border Protection regulations. Businesses must ensure transparency and accuracy in their supply chain records to benefit from this provision without legal repercussions.