How is customs duty calculated?
Sometimes the basic math is customs value multiplied by an ad valorem rate. The real answer can also include specific or compound rates, preferential treatment, additional duties, AD/CVD cash deposits, taxes, and fees.
The four-step journey
See the moving parts behind customs duty: classification, customs value, origin, preference, additional tariffs, trade remedies, taxes, and fees.
- Classify the merchandise
- Determine customs value
- Apply origin and special programs
- Add applicable duties, taxes, and fees
What the broker checks
- Current HTS and special tariff chapters
- Eligibility and evidence for preferences
- Trade-remedy scope and deposit instructions
Why it matters
The arithmetic is often easy. Getting the inputs legally correct is the hard part.
- Ad valorem: A rate expressed as a percentage of value.
- Specific rate: A rate based on quantity, weight, or another unit.
Official sources
- USITC — Harmonized Tariff Schedule
- 19 CFR Part 152 — Classification and Appraisement
- International Trade Administration — AD/CVD