Last Updated on April 15, 2025 by
If you’re an Aussie eCommerce merchant selling into the U.S., you’ve probably seen the headlines — and you’re not alone if you’re feeling confused. The short version? Yes, a 10% tariff applies to many Aussie-made goods entering the U.S., and yes, it’s already impacting brands like yours.
This stuff is changing daily, but here’s what we know as of today. Let’s break it down.
The Basics: How U.S. Import Tariffs Work
When your goods land on American soil, they go through U.S. Customs and Border Protection (CBP). If they meet the criteria, a 10% tariff is slapped on the declared value of the goods — and someone has to pay it.
Who, you ask? That depends on how you ship.
DDP vs DAP: Who Cops the Tariff?
There are two common international shipping setups when sending stock to U.S. customers:
DDP (Delivery Duty Paid) – You pay
When you ship with DDP (Delivery Duty Paid), you (the seller) absorb the cost.
- When? Tariff is paid upfront, during customs clearance.
- How? Your carrier (like DHL or FedEx) handles customs, pays the tariff on your behalf, and bills you later.
- Customer experience? Seamless. No surprise charges, no headaches.
- Business impact? You’ll need to factor these costs into your pricing and margins.
DAP (Delivered at Place) – The customer pays
Meanwhile, when you use DAP (Delivered at Place; previously known as DDU – Delivery Duty Unpaid), your customer pays the tariff.
- When? After the goods land, before they’re released for delivery.
- How? Your customer gets a notification from customs or the shipping carrier to pay the fees.
- Customer experience? Delays, confusion, unexpected fees — a recipe for cart abandonment.
- Business impact? You save on costs, but risk a hit to your brand perception and conversion rates.
Here’s how it stacks up:
Impact Factor | DDP (Delivery Duty Paid) | DAP (Delivered At Place) |
Who Pays Tariff | Seller (You) | Buyer (Your Customer) |
When Tariff is Paid | Before customs clearance | After customs clearance |
Delivery Speed | Faster – no delays at customs | Slower – package held until payment is made |
Customer Experience | Seamless – no surprises or extra steps | Potentially frustrating – delays and added costs |
Cash Flow Impact | You incur duties upfront (will lower margins) | No direct cost to you, but risk of lost sales |
Perception of Brand | Professional, premium, customer-first | Budget-conscious, less polished |
What U.S. Tariffs Look Like in Practice
Say you’re selling a $100 Aussie-made product to a U.S. customer:
- DDP: You wear the $10 tariff and either raise your price to cover it or absorb the cost.
- DAP: Your customer gets stung for $10 (plus handling) and might bail on the order (or avoid a repeat purchase).
Guess which one makes for a better customer experience?
What About the De Minimis Threshold?
You might’ve heard that goods under $800 USD can enter the U.S. duty-free. True… kind of. Here’s the fine print:
- If your product is made in China or Hong Kong, that exemption might not apply — even if shipped from Australia.
- If it’s Aussie-made and under $800 USD, you might avoid tariffs — but only with proper classification and paperwork.
So don’t bank on the threshold unless your documentation is rock-solid.
Want Tariff-Free Treatment? It’s Paperwork Time
Thanks to the AUSFTA (Australia–United States Free Trade Agreement), some products may be up for reduced or eliminated tariff rates. But you’ve got to play by the rules:
- Accurately classify products with HS codes
- Meet Rules of Origin requirements
- Provide a Certificate of Origin
- Use a customs broker or freight forwarder to stay compliant
If this sounds like a compliance rabbit hole — that’s because it is. But doing it right can save you and your customers money.
So, What Should eCommerce Brands Be Doing?
Here’s the SBO playbook for tackling U.S. tariffs like a pro:
✅ Choose your shipping model (DDP vs DAP) wisely – and own the customer experience.
✅ Get your product classification right – HS codes and origin rules matter.
✅ Be upfront at checkout (especially with DAP)
✅ Partner with a reliable freight forwarder or broker – this isn’t the time for a DIY job.
Need help? We broke down the tariff changes back when the Trump Administration announced them, where you’ll also find our handy Tariff Scenario Calculator. It’s a free tool that helps you figure out how these tariffs might hit your costs, so you can tweak your pricing, margins, or game plan before it messes with your bottom line.
At SBO, we work with eCommerce founders like you to turn operational headaches into profit levers. Whether it’s pricing strategy, cash flow forecasting, or just navigating these tariff changes without wrecking your margin — we’ve got your back.
If you’re selling into the U.S. and feeling the tariff pinch, let’s talk.
Disclaimer: U.S. tariff rules and exemptions are evolving daily — sometimes even hourly. For the latest updates and tailored advice specific to your product and shipping model, follow us on LinkedIn or get in touch with our team.
