Import Duty & Tax from China to USA 2024
The United States levied steep tariffs against a wide array of Chinese imports during the summer of 2018, a mechanism that up to now has helped see tensions between the United States and China over trade matters continue to escalate. This has created an extremely complex, shifting landscape for importers and exporters. COVID-19, disrupting world trade, cannot ease the situation either. Please do stay updated on the latest regulations on import duty for your consignments.
Though the Estimated Duty, computed by using our US Customs duty calculator, would be helpful, the actual Duty Rates are declared by the Customs Authorities.
What Is Customs Duty?
Customs duty is the tax on the goods being transported across international borders by a government, while import and sometimes export are also entertained. The two major purposes of customs duty are revenue generation and protection of local industries by increasing the price of the imported commodity against the domestically manufactured product.
Following are the key points about Customs Duty:
Calculation:
Customs duties are normally applied as a percentage against the total shipment value, including the cost of the goods, shipping, and insurance.
The exact rate is to be set depending on several variables: product type, country of origin, trade agreements, tariffs in place, and so on.
Harmonized System Codes:
There is an HS code classification for every product. These internationally standardized codes were very helpful in ascertaining what customs duty and taxes were to be applied to different items.
Types of Customs Duty:
- Ad Valorem Duty: a duty applied based on the value of themerchandise
Specific Duty: a duty levied based on a specific measurement, like weight, quantity, or volume - Compound Duty: includes both ad valorem and specific duties
- Tariffs and Trade Agreements: The customs duties that are levied may
vary depending on the trade agreements existing between countries. Free trade agreements, for instance, reduce or even totally eliminate the customs duty levied on specific goods for member countries.
Payment:
The customs duty is payable by the importer upon arrival of the goods in the country. Payment of an incorrect amount may lead to penalties, delays, or even seizure of goods.
Purpose:
These customs duties are meant to guard the local industries from foreign competition and for regulating entry as well as bringing in revenue to the government.
How is Customs Duty & US Import Tax Calculated?
Two of the most important factors that determine whether customs duties and import taxes are owed on something coming into the U.S. include the country of origin, and of course, the product itself, according to its HS code classification. Contrary to popular belief, international freight shipments valued under $2,500 are not automatically exempt from customs duties.
This misunderstanding probably occurs because of confusion with two other related regulations: firstly, that an informal customs entry is allowed for shipments under $2,500-a less complicated and much less expensive process; and secondly, that express freight shipments-handled by international couriers-often receive less stringent customs inspections. That does not necessarily mean, however, that they will not be subjected to duties or taxes.