USA Import Duties: Everything You Need to Know

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usa import duties

What is a duty?

A duty is a tax levied by the government on imported goods to protect domestic industries, regulate the balance of international trade, and increase state revenue. In the USA, import duties are levied based on factors such as the type, value, and origin of the goods, and the specific tax rate is determined using the HS code (an internationally standardized commodity coding system).

How is import duty calculated in the USA?

The calculation of import duty in the USA is based on the following elements

Classification of goods: according to the HTSUS (US Customs Commodity Classification Catalogue), each commodity has a specific HTS code, which determines the applicable tariff rate.

Country of origin: different countries of origin may have different tax rates, especially when free trade agreements are involved

Value of goods: This is usually based on the free on board (FOB) price, i.e., the price at which the seller loads the goods on board the ship for delivery.

The specific calculation formula is as follows:

Import duty = value of imported goods × applicable tariff rate

For some goods, the tariff may be calculated based on quantity rather than Value, e.g., a fixed fee per unit weight or quantity

Types of Duties and Taxes

In addition to basic tariffs, import taxes in the United States include the following types:

  1. Excise tax: applied to goods such as alcohol, tobacco, and fuel.
  2. Anti-Dumping Duties (ADD): Used to offset unfair competition from foreign goods sold below the regular price.
  3. Countervailing Duties (CVD): against unfair subsidies given to exporters by foreign governments.
  4. Tariff Quota: Additional charges are levied on goods that exceed the quota.
  5. Trade Sanctions: Additional tariffs are applied to goods from sanctioned countries.

How are rates determined?

  1. Commodity Classification: Different categories of goods have different tax rates, ranging from 0% to 37.5%.
  2. Country of origin: If the goods come from a country with a free trade agreement with the United States, they may qualify for lower or even zero tariffs.
  3. Policy changes: As the international trade environment changes, the U.S. government may adjust its tariff policy.
  4. Special provisions: Special provisions such as the Generalized System of Preferences (GSP), exemptions for certain goods, etc., may also affect the final tax rate.

How are import duties and taxes paid?

Declare the goods: The importer must submit a detailed import declaration to CBP when the goods arrive in the United States.

Calculate the duties and taxes: CBP calculates the duties, taxes, and fees payable based on the classification and value of the goods.

Pay online: The importer can pay the duties, taxes, and fees via CBP’s web portal (ACE system).

Clear customs and collect the goods: After the duties, taxes, and fees have been paid, the goods can pass through customs and enter the market or be delivered.

Summary

Preparing complete customs declaration documents, including commercial invoices, packing lists, shipping documents, certificates of origin, and necessary import licenses, is crucial to ensure smooth customs clearance. All documents must be accurate and complete; otherwise, delays or fines may result. In addition, keeping abreast of the latest policy changes is necessary to adjust business strategies in time to respond to any potential changes.

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