The United States, a major player in the world economy, has an open economy with comparatively simple cross-border trade regulations.
Issues with importing paperwork and duty fees still exist, despite the US’s persistent efforts to preserve its advantageous trading climate.
We created this tutorial to give you a thorough understanding of import taxes in the United States.
Types of Duties and Taxes
Four different kinds of taxes and levies are applied to items that are imported into the United States:
- Customs Duties
- Excise Tax
- Merchandise Processing Fee (MPF)
- Harbour Maintenance Fee (HMF)
They all have distinct functions and aren’t all relevant to your shipment.
Customs Duties
The U.S. Customs and Border imposes this tax on imported products priced at over USD 800.
The value and nature of the imports will decide the items’ applicable duty and the kind of clearance procedure they go through.
Imports above USD 800 will require a traditional customs clearance process. Still, eCommerce purchases between USD 800 and USD 2,500 (about MYR 3,720 to MYR 11,625) may be eligible for a simplified clearance process with less customs involvement.
Excise Tax
Customs and Border Protection (CBP) imposes excise taxes, which are federal charges, on excise commodities including alcohol and tobacco products. The Internal Revenue Service is in charge of collecting it.
Merchandise Processing Fee (MPF)
Depending on the kind of entrance into the United States, the Customs and Border Protection (CBP) charges a Merchandise Processing Fee (MPF) to imported items.
You can order samples for a low or $0 value if you own your own business or resell on an online marketplace like eBay. Simply mark the samples on the invoice as “samples of no commercial value” and declare them to be of a nominal value of USD 1.
Harbour Maintenance Fee (HMF)
The Customs and Border Protection (CBP) levies a fee known as the HMF on imported products that are shipped by sea.
It represents 0.125 percent of the commercial value of the imported shipment.
HMF is excluded from all imported air freight since this is a fee applied to maritime freight.