DIY 1 source Jul 8, 1:59 PM EDT Updated 3h ago 0 views

Tariff evasion puts American industry and jobs at risk

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Tariff evasion puts American industry and jobs at risk July 8, 2026 | 12:59 pm CDT

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Woodworking Industry News

Cabinets

Tariff evasion puts American industry and jobs at risk

Larry Adams

July 8, 2026 | 12:59 pm CDT

In 2025, the U.S. government greatly expanded the tariffs it charges on goods imported from numerous countries. Almost half of all goods that enter the U.S. are now subject to tariffs. Tariffs that exporters to the U.S. sometimes evade through illegal means.

The tariffs, which vary by product and country of origin, sometimes exceed 100% of the value of the imported products, according to an analysis from the litigation firm of Cohen Milstein. "While business owners, CEOs, consumers, economists, and politicians have differing views on the effectiveness of U.S. trade and tariff policies, tariffs are legal obligations that must be paid," according to a legal counsel paper on the practice. "When importers evade these obligations, they not only cheat the government and American citizens out of billions in revenue but also gain an unfair advantage over competitors who play by the rules and abide by the law. "

But some products entering the United States are skirting the tariffs in several ways, such as misclassifying the goods being imported by claiming that the item is another product that has a lower tariff or duty rate. Another practice is lying about the country of origin in required documentation submitted to U.S. Customs. This method, known as transshipping, is an illegal trade practice where goods are routed through a third-party country to disguise their true country of origin and dodge higher import duties. Smuggling goods into the U.S. without disclosing their entry to U.S. Customs. 

According to economists at Goldman Sachs, importers evaded payment of an estimated $125 billion in tariffs on goods imported into the U.S. in 2023. In a December 2024 Wall Street Journal investigation, reporters found that certain Chinese companies were skirting tariffs placed on Chinese goods in 2018 during the first Trump administration, and also in 2020 when the Biden administration slapped them with up to 262% in antidumping duties. 

CBP agents, the WSJ reported, were inspecting a site as part of a late 2022 inquiry into allegations that subsidiaries of Chinese company Qingdao Haiyan Group were evading tariffs. "Haiyan had been accused of sending Chinese-made cabinets to the U.S. by shipping them through Malaysia, masking the origin of the goods, a scheme known as transshipping," according to the WSJ story.

The practice of transshipping appears to not be limited to those years, and a recent seizure of cabinets by U.S. investigators appears to back up this statement. 

In June, U.S. Customs and Border Protection officers seized over $120,000 in "unmanifested kitchen cabinets" in Norfolk, Virginia, that agents say were clandestinely imported from China.

CBP officers initially inspected the shipping container on May 18. The contents were manifested as 10 kitchen cabinets, with a declared value of $500, and 691 other items such as metal ornaments, home decorations, storage boxes, and decorative panels. Officers discovered that none of those other declared items were in the container. Instead, officers found 781 cartons of kitchen cabinets.

Betsy Natz, CEO of the Kitchen Cabinet Manufacturers Association, said that tariff evasion schemes such as this defraud the U.S. government of lawfully owed duties and undermine legitimate sales of the domestic kitchen cabinet industry.

“Whether through transshipment, undervaluation, or misclassification under the Harmonized Tariff Schedule, duty evasion places U.S. cabinet manufacturers and their employees at a significant competitive disadvantage," Natz said. "These illegal practices threaten American jobs, discourage domestic investment, and, in many cases, put manufacturers at risk of going out of business.  This is not an exaggeration, smuggling cabinets into the United States weakens our industry and harms the American workers and communities that depend on it."

Natz also warned that companies that purchase imported cabinets should also recognize that tariff evasion carries significant legal risks. "Every participant in the supply chain, including importers, distributors, customs brokers, and others who knowingly or unknowingly facilitate these schemes, may be subject to investigation and potential criminal prosecution by the U.S. Department of Justice. CBP's enforcement efforts send a strong message that tariff evasion is not a victimless crime and that those who engage in these illegal practices will be held accountable.”

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Tariffs and International Trade

Lawsuits and Courts

About the author

Larry Adams

| Editor

Larry Adams is a Chicago-based writer and editor who writes about how things get done. A former wire service and community newspaper reporter, Larry is an award-winning writer with more than three decades of experience. In addition to writing about woodworking, he has covered science, metrology, metalworking, industrial design, quality control, imaging, Swiss and micromanufacturing . He was previously a Tabbie Award winner for his coverage of nano-based coatings technology for the automotive industry. Larry volunteers for the historic preservation group, the Kalo Foundation/Ianelli Studios, and the science-based group, Chicago Council on Science and Technology (C2ST).

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