USA Customs Duties

US Customs Duties Are Routinely Overpaid

Why? It’s complicated and constantly changing.

• The US Customs and Border Protection (CBP) typically issues an average of 100 – 250 new rulings each week. Who has time to read them all?
• Some new rulings may apply to your goods and make them duty free, but how would you know if you haven’t read them?
• There are over 180,000 of these rulings published online at the Customs Ruling Online Search System (CROSS), http://rulings.cbp.gov/. Some rulings are missing and some are wrong or outdated.
• Some rulings contradict other rulings.
• There are about 200 ruling reversals or amendments issued every year.
• Rulings that have been overturned by the courts are not updated.
• There are obscure international agreements that grant duty relief and duty exemptions. How can an importer claim an exemption that is unknown?

What we do: We look at your supply chain management in order to identify opportunities for duty relief. We provide everything you need to facilitate any available recovery and reduction. This includes the services of customs attorneys and other experts.

• Over 300 Official Ports of Entry

  The USA has over 300 ports of entry in addition to a number of Preclearance offices in Canada and the Caribbean, and each one has the authority to assess. What are the chances that all of the customs officers in all of the ports agree with each other on all tariff interpretations?

• Different Assessments in Different Ports

  One importer can be clearing goods duty free on entries in Birmingham, Alabama while another importer is paying duty on the same goods entered in Victoriaville, California.

• The Human Perspective

  How we perceive something is a product of our life experience. A customs officer who is looking forward to celebrating his daughter's graduation may see a mortar board as a festive article. Another officer may just see a hat. A festive article could be duty free, while a hat is dutiable.

• Protests Not Published

  If an importer does not agree with an assessment, the recourse is to file a protest which includes an argument to support the protest. US customs often takes many months to rule on it. How would an importer know if there are very valid protests pending on goods he imports?

• Time is of the Essence

  If customs duty has been overpaid, an importer has 180 days from liquidation to file a protest. After that, the overpayment is no longer refundable.

• Compliance is a Moving Target

  There are over 170,000 published customs rulings and these are constantly being updated, changed or added to. The US court of International Trade is busy ruling on disputes. What precedents do their decisions set? Does the rationale used for a specific import also apply to other goods which may share similarities? Who figures all of this out?

RetailCo Overpays US Customs Duties

Retailco (not its real name), is a North American retail chain.

Retailco is overpaying US customs duties and doesn't even know it. It buys goods from US wholesalers and retails them throughout North America. Some of the goods it sells were made in China and Europe. The wholesaler, not Retailco, paid the import duties on these goods.

The goods which Retailco ships to its Canadian stores are exports. The original customs duty paid by the wholesaler on goods subsequently exported is refundable to Retailco if there is a Certificate of Delivery with the purchase. Retailco has never asked for a Certificate of Delivery and continues to overpay the hidden customs duties in the price of goods purchased.

Retailco could claim a drawback (refund) of the original customs duty which the wholesaler paid, but doesn't. This is just one example of how millions of dollars in customs duties are overpaid.