Import Duty Calculator by Country: Complete Guide 2025

Accurately calculating import duties is critical for pricing products, managing cash flow, and maintaining compliance with U.S. Customs and Border Protection (CBP). For importers, understanding how duties vary by country of origin, product classification, and trade agreements directly impacts landed costs and profit margins.

This comprehensive guide explains how to calculate U.S. import duties step-by-step, covers tariff rates for major trading partners, details additional charges beyond base duties, and provides strategies to legally minimize duty costs.

What Are Import Duties and Why They Matter

Import duties (also called customs duties or tariffs) are taxes imposed by the U.S. government on imported goods. Duty rates vary based on:

Product classification (10-digit Harmonized Tariff Schedule code)
Country of origin (determines applicable tariff rate and FTA eligibility)
Trade policy (Section 301 additional tariffs, Section 232 tariffs, anti-dumping/countervailing duties)
Declared value (customs valuation determines the amount subject to duty)

Import duties directly affect your landed cost—the total cost of getting products from suppliers to your warehouse, including all fees and duties. Underestimating duties by just 5% on a $1 million annual import program means $50,000 in unexpected costs.

Beyond direct financial impact, inaccurate duty calculation or payment creates serious compliance risks:

Underpayment: Results in CBP penalties of 2-40% of duties owed, plus interest and potential loss of import privileges
Overpayment: Ties up cash unnecessarily (though recoverable via protest within 180 days of liquidation)
Misclassification: Can trigger CBP audits, focused assessments, and reputational damage

For these reasons, accurate duty calculation is both a financial and legal imperative.

Types of Import Charges: Beyond Basic Tariffs

When calculating total import costs, you must account for multiple layers of duties and fees:

1. MFN (Most Favored Nation) Tariff Rate

The MFN rate (also called Normal Trade Relations or NTR rate) is the standard duty rate applied to imports from World Trade Organization (WTO) member countries. This is the base tariff rate you'll find in the Harmonized Tariff Schedule (HTS).

MFN rates vary widely by product:

Agricultural products: 0-350% (some quotas and tariff-rate quotas apply)
Textiles and apparel: 0-32%
Electronics and machinery: 0-6%
Footwear: 8-48%
Furniture: 0-8%
Chemicals and plastics: 0-12%

Most countries receive MFN treatment because they are WTO members (164 countries as of 2025). Notable exceptions receiving higher "Column 2" rates include North Korea and Cuba.

2. Preferential Tariff Rates (Free Trade Agreements)

Preferential rates are lower or zero tariff rates available under free trade agreements (FTAs) when imported products meet specific rules of origin requirements.

Major U.S. FTAs and preferential programs:

USMCA (United States-Mexico-Canada Agreement): Replaced NAFTA in 2020. Offers zero or reduced tariffs on qualifying goods from Mexico and Canada. Rules of origin vary by product (e.g., automotive: 75% regional value content; textiles: yarn-forward rule).
Korea FTA (KORUS): Most products from South Korea qualify for zero tariffs under phase-out schedules (fully implemented by 2024 for most goods).
Other FTAs: Chile, Colombia, Peru, Australia, Singapore, Morocco, Bahrain, Oman, Panama, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua.
GSP (Generalized System of Preferences): Zero tariffs on 3,500+ products from 120+ developing countries. GSP expired in December 2020 but has been periodically renewed by Congress; check current status.

To claim preferential rates, you must:

Verify the product qualifies under the FTA's rules of origin
Obtain required origin documentation from suppliers (USMCA certification, FTA certificate of origin)
Claim preferential treatment when filing entry with CBP
Maintain records for 5 years to support the claim

Critical: Incorrectly claiming preferential rates when products don't qualify results in penalties and interest on unpaid duties.

3. Section 301 Additional Tariffs

Section 301 tariffs are additional duties imposed on Chinese imports in response to China's trade practices, intellectual property policies, and technology transfer requirements. These tariffs are charged in addition to MFN rates.

Four "Lists" of Section 301 tariffs exist:

| List | Products Covered | Additional Duty Rate | Value of Imports Affected | |------|------------------|----------------------|---------------------------| | List 1 | Industrial machinery, electronics, aerospace | 25% | $34 billion | | List 2 | Semiconductors, plastics, chemicals, railway equipment | 25% | $16 billion | | List 3 | Consumer goods, furniture, luggage, handbags, lighting | 7.5% | $200 billion | | List 4A | Apparel, footwear, toys, sporting goods, home textiles | 7.5% | $300 billion |

Total value of Chinese imports subject to Section 301 tariffs: $550+ billion annually (about 66% of all U.S. imports from China).

Example: Electronics classified under HTS 8471.30.01 imported from China:

MFN rate: 0%
Section 301 rate (List 1): 25%
Total tariff: 25% ($25,000 duty on $100,000 shipment)

Exclusion process: Some products have been granted exclusions from Section 301 tariffs. Check USTR's exclusion database or consult your customs broker to see if your products qualify.

Important: Section 301 rates can change with minimal notice based on trade negotiations or presidential proclamations. Monitor USTR announcements closely.

4. Section 232 Tariffs (Steel and Aluminum)

Section 232 tariffs are additional duties imposed on steel and aluminum imports based on national security considerations:

Steel: 25% additional duty
Aluminum: 10% additional duty

Coverage: Applies to steel and aluminum products imported from most countries, with exemptions for Canada, Mexico (under USMCA), and certain other countries based on quota agreements.

These tariffs are charged in addition to MFN rates.

5. Anti-Dumping Duties (ADD) and Countervailing Duties (CVD)

ADD and CVD are punitive tariffs imposed on specific products from specific countries to offset unfair trade practices:

Anti-dumping duties: Offset foreign producers selling products in the U.S. below fair value (below cost or below home market price)
Countervailing duties: Offset foreign government subsidies that give producers an unfair advantage

ADD/CVD rates can be extremely high, ranging from 10% to over 300% of product value.

Common products subject to ADD/CVD:

Steel products (pipe, wire rod, plate, sheet)
Certain chemicals and plastics
Furniture (wooden bedroom furniture from China: 216% ADD)
Tires (passenger vehicle tires from China, Korea, Taiwan)
Solar panels
Certain food products (shrimp, honey, crawfish)

Critical: ADD/CVD rates are not reflected in HTS tariff schedules. You must check CBP's ADD/CVD case list separately or consult your customs broker to determine if your product is subject to these duties.

Scope rulings: If you believe your product is similar but not covered by an ADD/CVD order, you can request a scope ruling from CBP.

6. Merchandise Processing Fee (MPF)

MPF is a fee charged by CBP for processing formal entries (commercial imports over $2,500 in value).

MPF calculation:

Rate: 0.3464% of cargo value
Minimum: $27.75 per entry
Maximum: $614.35 per entry

Example calculations:

$5,000 shipment: 0.3464% = $17.32, but minimum applies → $27.75 MPF
$100,000 shipment: 0.3464% = $346.40 → $346.40 MPF
$500,000 shipment: 0.3464% = $1,732, but maximum applies → $614.35 MPF

MPF is charged on virtually all commercial imports regardless of duty rate. Even if your product has a zero MFN tariff and qualifies for USMCA treatment, you still pay MPF on formal entries.

Exemptions: Very limited; includes goods from U.S. Insular Possessions (Puerto Rico, U.S. Virgin Islands, American Samoa, Guam) and certain government/military imports.

7. Harbor Maintenance Fee (HMF)

HMF funds maintenance and improvement of U.S. harbors and waterways.

HMF calculation:

Rate: 0.125% of cargo value
No minimum or maximum
Charged only on cargo entering through ocean ports and Great Lakes ports (not airports)

Example: $100,000 shipment arriving at Port of Los Angeles

HMF: $100,000 × 0.00125 = $125

Exemptions: Air cargo, exports, goods from U.S. territories, certain government imports.

Why it matters: HMF adds to landed cost but is often overlooked in initial duty estimates. For high-volume ocean importers, HMF can total $50,000-$200,000+ annually.

How to Calculate Import Duties: Step-by-Step Process

Follow this systematic approach to accurately calculate all duties and fees on your imports:

Step 1: Determine Customs Value

Customs value is the basis for calculating ad valorem (percentage-based) duties.

Primary valuation method: Transaction Value

The price actually paid or payable for the goods when sold for export to the U.S.
Includes: Product cost (FOB), packing costs, assists (molds, tooling, materials provided by buyer)
May include (depending on Incoterms): Freight to U.S. port, insurance

Common valuation scenarios:

| Incoterm | Includes in Customs Value | Excludes from Customs Value | |----------|---------------------------|------------------------------| | FOB (Free on Board) | Product cost only | International freight, insurance | | CIF (Cost, Insurance, Freight) | Product cost + freight + insurance | Nothing (all included in declared value) | | DDP (Delivered Duty Paid) | Product cost + freight + insurance + duties | Duties already paid (credit against CBP duties) |

For most imports, use FOB value. Under U.S. customs regulations, international freight and insurance are generally not added to customs value for duty calculation (unlike some other countries).

Example: You purchase goods for $100,000 FOB Shanghai. Ocean freight to Los Angeles is $3,000, and insurance is $300.

Customs value for duty calculation: $100,000 (FOB price)
Freight and insurance are excluded from the dutiable value

Exceptions: Certain product categories or special circumstances may require CIF valuation or other methods. Consult your customs broker for complex scenarios.

Step 2: Classify Your Product (Find HTS Code)

Every imported product must be classified using a 10-digit Harmonized Tariff Schedule (HTS) code. This code determines:

Applicable MFN tariff rate
Whether Section 301, Section 232, or ADD/CVD applies
Regulatory requirements (FDA, USDA, EPA, CPSC, etc.)
Eligibility for FTA preferential rates

How to find your HTS code:

Use USITC HTS Online Lookup: Visit https://hts.usitc.gov/
Search by keyword: Enter product description (e.g., "laptop computer," "cotton t-shirt," "office chair")
Review results: Browse chapters and headings to find the most specific classification
Apply General Rules of Interpretation (GRI): If multiple codes could apply, use GRI 1-6 to determine the correct classification
Verify with a customs broker: For complex or high-value products, consult a licensed broker to ensure correct classification

HTS code structure (10 digits):

First 2 digits: Chapter (broad product category, e.g., Chapter 84 = Machinery)
First 4 digits: Heading (product group)
First 6 digits: Subheading (internationally harmonized)
Digits 7-10: U.S.-specific tariff classification and statistical suffix

Example: Laptop computer

8471.30.01: HTS code
- 84: Machinery and mechanical appliances
- 8471: Automatic data processing machines
- 8471.30: Portable automatic data processing machines (laptops)
- 8471.30.01: Statistical suffix for specific laptop types

Common classification errors:

Classifying based on end use rather than product characteristics (GRI requires objective classification)
Using outdated HTS codes (HTS is updated annually)
Choosing broad/general codes when more specific codes exist (always use the most specific classification)

Why accurate classification matters:

Overpayment: Using a 16.6% apparel code when the correct 0% electronics code applies costs you 16.6% of value
Underpayment: Incorrectly classifying $1M of goods at 0% when the correct rate is 25% results in $250,000 in unpaid duties plus penalties (potentially $50,000-$100,000) and interest

Best practice: For your top 20 imported products (by value), pay a customs broker or trade attorney to conduct formal HTS classification reviews. This investment ($500-$2,000 per product) can save tens of thousands in overpaid duties or avoided penalties.

Step 3: Identify Country of Origin

Country of origin determines which tariff rate applies (MFN vs. preferential) and whether additional tariffs like Section 301 or ADD/CVD are charged.

Determining origin:

For single-country products (made entirely in one country), origin is straightforward.

For multi-country products (components or processing from multiple countries), apply substantial transformation test:

The country where the product underwent its last substantial transformation is the country of origin
Substantial transformation means the product emerged with a new name, character, or use

Examples:

Fabric woven in China, cut and sewn into shirts in Vietnam → Origin: Vietnam (cutting and sewing is substantial transformation)
Computer chips made in Taiwan, assembled into laptops in China → Origin: China (assembly is substantial transformation)
Raw steel from China, shaped into furniture in Mexico → Origin: Mexico (substantial transformation)

Why origin matters:

| Product | Made in China | Made in Vietnam | Made in Mexico (USMCA-qualified) | |---------|---------------|-----------------|----------------------------------| | Office furniture (HTS 9403.30) | MFN 0% + Section 301 7.5% = 7.5% total | MFN 0% = 0% total | USMCA 0% = 0% total | | Cotton t-shirts (HTS 6109.10) | MFN 16.5% + Section 301 7.5% = 24% total | MFN 16.5% = 16.5% total | USMCA 0% (if yarn-forward rule met) = 0% total |

Compliance tip: Always obtain country of origin documentation from suppliers (supplier's declarations, certificates of origin). CBP may request proof of origin, especially for preferential FTA claims.

Step 4: Check for Preferential Rates (FTA Eligibility)

If your supplier's country has an FTA with the U.S., determine if your products qualify for preferential (reduced or zero) tariff rates.

Key FTAs and how to qualify:

USMCA (Mexico, Canada):

Rules of origin vary by product category:
- Automotive: 75% regional value content, specific labor requirements
- Textiles/apparel: Yarn-forward rule (yarn must originate in USMCA region)
- Electronics: Tariff shift rules or regional value content
Certification: Importer, exporter, or producer can certify origin (no government-issued certificate required)
Record retention: Maintain certifications and supporting documentation for 5 years

Korea FTA (KORUS):

Most products qualify for zero tariffs under phase-out schedules (fully implemented for most goods by 2024)
Certificate of origin required: Supplier must provide completed certificate
Product must meet tariff shift, regional value content, or wholly obtained criteria

Other FTAs: Similar structure—rules of origin, origin certification, record retention requirements. Consult your customs broker for specific FTA qualifications.

Benefit example: Importing $500,000 of auto parts (HTS 8708.99) from Mexico:

Without USMCA: MFN rate 2.5% = $12,500 duties
With USMCA qualification: 0% = $0 duties
Annual savings (12 shipments): $150,000

Why importers miss FTA benefits:

Suppliers don't provide origin documentation (many don't know it's required)
Importers assume they don't qualify without checking
Customs brokers aren't instructed to investigate FTA opportunities
Recordkeeping requirements seem burdensome

Best practice: Conduct an FTA qualification analysis for your top imported products. Even if qualification requires supplier changes (e.g., using USMCA-origin components), the duty savings often justify the investment.

Step 5: Add Section 301, Section 232, or ADD/CVD Rates if Applicable

After determining your base MFN or preferential rate, check if additional tariffs apply.

Section 301 (China):

Check if your HTS code appears on USTR's Section 301 tariff lists (1, 2, 3, 4A)
Verify product description matches (HTS codes alone aren't always sufficient; product descriptions provide scope)
Add applicable rate (25% for Lists 1 and 2, 7.5% for Lists 3 and 4A)
Check for exclusions: Some products have been granted temporary or permanent exclusions

Section 232 (Steel and Aluminum):

If importing steel (Chapter 72) or aluminum (Chapter 76) products, check if Section 232 tariffs apply
Exemptions for Canada and Mexico (under USMCA) and certain other countries with quota agreements
Add 25% (steel) or 10% (aluminum) if applicable

ADD/CVD:

Check CBP's ADD/CVD case database or consult your customs broker
Verify country of origin matches case scope
Verify product description matches case scope (many cases are very specific: e.g., "certain steel nails" not all nails)
Add applicable ADD and/or CVD rate (rates vary widely by case and producer)

Example: Wooden bedroom furniture from China (HTS 9403.60)

MFN rate: 0%
Section 301 rate (List 3): 7.5%
ADD rate (case A-570-890): 216.01% (for certain producers)
Total tariff: 223.51% (!!)

This example illustrates why checking all applicable duties is critical—relying only on the HTS tariff rate (0%) would miss $223,510 in duties on a $100,000 shipment.

Step 6: Calculate Base Duty

Now calculate the actual duty owed based on your customs value and applicable tariff rates.

Formula:

Base Duty = Customs Value × (MFN or Preferential Rate + Section 301 Rate + Section 232 Rate + ADD Rate + CVD Rate)

Example 1: Electronics from China

Customs value: $100,000
HTS: 8471.30.01 (laptop computers)
MFN rate: 0%
Section 301 rate (List 1): 25%
Base duty: $100,000 × 25% = $25,000

Example 2: Apparel from Vietnam

Customs value: $80,000
HTS: 6203.42.40 (men's cotton trousers)
MFN rate: 16.6%
Section 301: Not applicable (Vietnam)
Base duty: $80,000 × 16.6% = $13,280

Example 3: Auto parts from Mexico (USMCA-qualified)

Customs value: $150,000
HTS: 8708.99.81 (automobile parts)
MFN rate: 2.5%
USMCA preferential rate: 0% (if qualified)
Base duty: $150,000 × 0% = $0

Step 7: Add MPF and HMF

Calculate Merchandise Processing Fee and Harbor Maintenance Fee.

MPF calculation:

Cargo value × 0.3464%
Minimum $27.75, maximum $614.35
Applies to all formal entries (over $2,500)

HMF calculation (ocean shipments only):

Cargo value × 0.125%
No minimum or maximum
Only for ocean and Great Lakes ports (not air cargo)

Example (continuing Example 1 above):

Customs value: $100,000
MPF: $100,000 × 0.003464 = $346.40
HMF (ocean shipment): $100,000 × 0.00125 = $125.00
Total MPF + HMF: $471.40

Step 8: Calculate Total Landed Cost

Combine all costs to determine your true landed cost per unit.

Formula:

Total Landed Cost = Product Cost (FOB) + Freight + Insurance + Base Duty + MPF + HMF + Broker Fees + Other Costs

Complete Example: 40' container of electronics from China to Los Angeles

| Cost Component | Amount | Notes | |----------------|--------|-------| | Product cost (FOB Shanghai) | $100,000 | 1,000 units @ $100 each | | Ocean freight | $3,000 | Shanghai to LA, 40' container | | Marine cargo insurance | $300 | 0.3% of cargo value | | Subtotal (CIF value) | $103,300 | | | Customs value | $100,000 | FOB only (U.S. excludes freight/insurance) | | Base duty (25% Section 301) | $25,000 | $100,000 × 25% | | MPF | $346 | $100,000 × 0.3464%, within min/max range | | HMF | $125 | $100,000 × 0.125% | | Customs broker fee | $400 | Entry filing, ISF, documentation | | Total duties and fees | $25,871 | | | Total landed cost | $129,171 | Product + freight + insurance + duties/fees | | Landed cost per unit | $129.17 | $129,171 ÷ 1,000 units |

Key insight: The product cost was $100/unit, but the true landed cost is $129.17/unit—a 29% increase. Accurate landed cost calculation is essential for pricing, margin analysis, and competitiveness.

Country-Specific Guidance: Major U.S. Trading Partners

Import duty calculations vary significantly by country of origin due to different tariff rates, FTA status, and additional duties.

China

Status: MFN (WTO member), no FTA, subject to Section 301 tariffs

Tariff structure:

Base MFN rates: 0-37.5% depending on product (average 3.4% across all products)
Section 301 additional tariffs: 7.5-25% on $550B+ of imports (66% of all Chinese imports)
ADD/CVD: Many products subject to anti-dumping and countervailing duties (steel, furniture, tires, solar panels, etc.)

Typical total duty rates:

Electronics (laptops, phones, semiconductors): 0-6% MFN + 25% Section 301 = 25-31% total
Machinery and industrial equipment: 0-3% MFN + 25% Section 301 = 25-28% total
Consumer goods (furniture, luggage, lighting): 0-8% MFN + 7.5% Section 301 = 7.5-15.5% total
Apparel and footwear: 8-32% MFN + 7.5% Section 301 = 15.5-39.5% total
Textiles: 5-25% MFN + 7.5% Section 301 = 12.5-32.5% total

Mitigation strategies:

Source from non-Chinese suppliers: Vietnam, Mexico, India, or other countries not subject to Section 301 tariffs
Check for exclusions: Some products have exclusions from Section 301 tariffs (time-limited, must apply)
Utilize Foreign Trade Zones (FTZ): Defer duty payment until goods enter U.S. commerce, or avoid duties on re-exported goods
Tariff engineering: Modify products to qualify for lower HTS codes (must be genuine product changes, not artificial classification manipulation)

Case study: Electronics importer shifted 60% of sourcing from China (25% total duty) to Vietnam (0% MFN rate, no Section 301). On $8M annual imports, saved $1.2M annually in Section 301 tariffs (($8M × 0.60) × 25% = $1.2M).

Mexico and Canada (USMCA)

Status: USMCA members (free trade agreement), most products qualify for zero or reduced tariffs

Tariff structure:

MFN rates: Same as other countries (0-37.5% depending on product)
USMCA preferential rates: 0% for most products if rules of origin met
No Section 301, Section 232 (steel/aluminum), or ADD/CVD for USMCA-qualified goods

USMCA rules of origin (vary by product):

Automotive: 75% regional value content (RVC), 40-45% produced by workers earning ≥$16/hour
Textiles and apparel: Yarn-forward rule (yarn and all subsequent processes must occur in USMCA region)
Electronics: Tariff shift or RVC requirements
Agricultural products: Wholly obtained or tariff shift rules

Certification requirements:

Importer, exporter, or producer can certify origin (self-certification, no government certificate)
Certification must include specific data elements (producers, HS codes, origin criteria, blanket period if applicable)
Maintain certification and supporting records for 5 years

Typical duty savings:

Auto parts (HTS 8708): MFN 2.5% vs USMCA 0% = 2.5% savings
Apparel (HTS 6203): MFN 16.6% vs USMCA 0% (if qualified) = 16.6% savings
Machinery (HTS 8477): MFN 3.1% vs USMCA 0% = 3.1% savings

Example: $5M annual imports of apparel from Mexico

Without USMCA: $5M × 16.6% = $830,000 duties
With USMCA (yarn-forward rule met): $5M × 0% = $0 duties
Annual savings: $830,000

Common USMCA mistakes:

Assuming all goods from Mexico/Canada automatically qualify (must meet specific rules of origin)
Not obtaining certifications from suppliers (can't claim preferential treatment without documentation)
Using non-USMCA materials/components when USMCA alternatives exist (failing to optimize sourcing for origin qualification)

Vietnam

Status: MFN (WTO member), no FTA, generally not subject to Section 301 or Section 232

Tariff structure:

Base MFN rates: 0-37.5% depending on product
No Section 301 tariffs (though some concern about transshipped Chinese goods triggering anti-circumvention duties)
Limited ADD/CVD cases (certain shrimp, catfish, steel products)

Typical total duty rates:

Electronics: 0-6% MFN = 0-6% total (vs 25-31% from China)
Apparel and footwear: 8-32% MFN = 8-32% total (vs 15.5-39.5% from China)
Furniture: 0-8% MFN = 0-8% total (vs 7.5-15.5% + potential 216% ADD from China)

Why Vietnam is attractive for U.S. importers:

No Section 301 tariffs (25-percentage-point advantage over China for many products)
Competitive manufacturing costs
Growing industrial capacity (textiles, footwear, electronics, furniture)
Improving logistics infrastructure

Risks:

Transshipment scrutiny: CBP closely monitors goods claiming Vietnamese origin to detect Chinese goods routed through Vietnam for tariff evasion
Origin verification: Importers must maintain credible evidence of Vietnamese origin (factory audits, production records, material sourcing documentation)
Potential future tariffs: Vietnam could be subject to new tariffs or trade restrictions based on trade balance, currency practices, or other policy considerations

Compliance best practice: For high-value or high-risk products (electronics, apparel, goods in same HTS codes as major Chinese exports), conduct supply chain due diligence to verify genuine Vietnamese origin. Document factory visits, material sourcing, and production processes.

India

Status: MFN (WTO member), no FTA, generally not subject to Section 301 or Section 232

Tariff structure:

Base MFN rates: 0-37.5% depending on product
No Section 301 or Section 232 tariffs currently
Limited ADD/CVD cases (steel pipe, certain chemicals)

Typical total duty rates:

Textiles and apparel: 5-32% MFN = 5-32% total
Gems and jewelry: 0-5% = 0-5% total
Chemicals and pharmaceuticals: 0-6.5% = 0-6.5% total
Machinery: 0-4.5% = 0-4.5% total

India's role in U.S. trade policy:

Removed from GSP (Generalized System of Preferences) in 2019, eliminating zero-tariff benefits for certain products
FTA negotiations have been discussed but not actively pursued as of 2025
Potential for future preferential trade arrangements

European Union

Status: MFN (WTO member), no FTA (negotiations paused), not subject to Section 301

Tariff structure:

Base MFN rates: 0-37.5% depending on product
No Section 301 tariffs
Section 232 tariffs apply to steel (25%) and aluminum (10%) from most EU countries (exemptions negotiated for some members under quota arrangements)

Typical total duty rates:

Machinery and industrial equipment: 0-4.5% MFN = 0-4.5% total
Pharmaceuticals and chemicals: 0-6.5% = 0-6.5% total
Wine and spirits: $1.27-$3.40 per liter (specific rates, not ad valorem)
Automobiles: 2.5% (passenger cars), 25% (light trucks/SUVs)

Trade policy context:

U.S.-EU FTA negotiations (Transatlantic Trade and Investment Partnership, TTIP) paused in 2016
No active FTA negotiations as of 2025
Steel and aluminum tariffs remain contentious issue

South Korea (KORUS FTA)

Status: Free trade agreement (Korea-U.S. FTA, implemented 2012, amended 2019)

Tariff structure:

MFN rates: 0-37.5% depending on product
KORUS preferential rates: 0% for most products under phase-out schedule (fully implemented by 2024 for most goods)
Certificate of origin required to claim preferential rates

Typical duty savings:

Automotive parts: MFN 2.5% vs KORUS 0% = 2.5% savings
Electronics and semiconductors: MFN 0-6% vs KORUS 0% = 0-6% savings
Machinery: MFN 0-4.5% vs KORUS 0% = 0-4.5% savings

KORUS rules of origin:

Tariff shift (product classified in different HTS chapter/heading than inputs)
Regional value content (35-55% depending on product)
Wholly obtained in Korea or U.S.

Certification: Supplier must provide certificate of origin with specific data elements. Maintain for 5 years.

Online Import Duty Calculator Tools

Several tools can help estimate import duties, but always verify results with a licensed customs broker or official sources before relying on them for business decisions.

1. USITC HTS Online Lookup (Official)

Source: U.S. International Trade Commission (https://hts.usitc.gov/)

Features:

Official U.S. Harmonized Tariff Schedule database
Search by keyword or HTS code
Shows MFN rates, special rates (FTA), Column 2 rates
Includes chapter notes and General Rules of Interpretation
Updated annually (current year HTS)

Pros:

Official, authoritative source
Free
Most accurate for MFN and FTA preferential rates

Cons:

Does not automatically include Section 301, Section 232, or ADD/CVD rates (must check separately)
Requires understanding of HTS classification methodology
Does not calculate total landed cost (only shows tariff rates)

Best for: Finding official tariff rates by HTS code, verifying classifications, understanding rules and notes.

2. USA Trade Online (U.S. Census Bureau)

Source: U.S. Census Bureau (subscription required, ~$300/year)

Features:

Historical import data by HTS code, country, port, district
Actual duty rates collected by CBP (including all additional duties)
Trade value and quantity statistics
Trend analysis tools

Pros:

Shows real-world effective duty rates (what importers actually paid)
Historical data for trend analysis
Official government data

Cons:

Subscription required
Data is historical (3-6 months lag), not forward-looking
Does not provide calculator functionality (raw data only)

Best for: Research and analysis, verifying what others pay for similar products, identifying tariff trends.

3. Commercial Duty Calculators

Examples: SimplyDuty, Duty Calculator, Import Duty Calculator

Features:

User-friendly interfaces
Estimate duties, MPF, HMF based on inputs (value, HTS code, country)
Some include freight and insurance estimation
Landed cost calculators

Pros:

Easy to use
Provide quick estimates
Some include freight cost estimation

Cons:

Not authoritative (rely on third-party data that may be outdated)
May not include current Section 301, Section 232, or ADD/CVD rates
Accuracy varies by provider
Some charge subscription fees

Best for: Quick preliminary estimates, comparing scenarios, general planning (always verify with official sources).

4. Ballast Markets Tariff Forecasts

Source: Ballast Markets

Features:

Forward-looking tariff rate predictions based on policy analysis and market sentiment
Hedging tools for tariff rate changes
Effective tariff rate (ETR) forecasts by product category and country

Pros:

Predictive (helps plan for future tariff changes, not just current rates)
Hedging capability (offset financial impact of tariff increases)
Market-based pricing reflects collective expectations

Cons:

Predictions, not guarantees (actual rates may differ)
Focused on policy-driven tariffs (Section 301, Section 232), not base MFN rates

Best for: Risk management, hedging tariff exposure, scenario planning for trade policy changes.

Example Calculations: Detailed Scenarios

Scenario 1: Electronics from China ($100,000 shipment)

Product: Laptop computers (HTS 8471.30.01) Supplier: Shenzhen, China Incoterm: FOB Shanghai Value: $100,000 (1,000 units @ $100 each) Ocean freight: $3,000 (Shanghai to Los Angeles) Insurance: $300

Step-by-step calculation:

Customs value: $100,000 (FOB, excludes freight and insurance)
HTS code: 8471.30.01
Country of origin: China
MFN rate: 0% (electronics are duty-free under MFN)
Section 301 rate: 25% (List 1)
Base duty: $100,000 × 25% = $25,000
MPF: $100,000 × 0.3464% = $346.40
HMF: $100,000 × 0.125% = $125.00
Broker fees: $400 (entry filing, ISF, documentation)

Total costs:

| Line Item | Amount | |-----------|--------| | Product cost (FOB) | $100,000 | | Ocean freight | $3,000 | | Insurance | $300 | | Import duty (Section 301) | $25,000 | | MPF | $346 | | HMF | $125 | | Broker fee | $400 | | Total landed cost | $129,171 | | Cost per unit | $129.17 |

Duty as % of total cost: $25,000 ÷ $129,171 = 19.4% of total landed cost Effective duty rate on FOB value: $25,000 ÷ $100,000 = 25%

Scenario 2: Apparel from Vietnam ($80,000 shipment)

Product: Men's cotton trousers (HTS 6203.42.40) Supplier: Ho Chi Minh City, Vietnam Incoterm: FOB Ho Chi Minh City Value: $80,000 (4,000 units @ $20 each) Ocean freight: $2,500 (Ho Chi Minh City to Long Beach) Insurance: $250

Step-by-step calculation:

Customs value: $80,000 (FOB)
HTS code: 6203.42.40 (men's cotton trousers, not knit, with 36% or more cotton)
Country of origin: Vietnam
MFN rate: 16.6%
Section 301 rate: Not applicable (Vietnam)
Base duty: $80,000 × 16.6% = $13,280
MPF: $80,000 × 0.3464% = $277.12
HMF: $80,000 × 0.125% = $100.00
Broker fees: $350

Total costs:

| Line Item | Amount | |-----------|--------| | Product cost (FOB) | $80,000 | | Ocean freight | $2,500 | | Insurance | $250 | | Import duty (MFN 16.6%) | $13,280 | | MPF | $277 | | HMF | $100 | | Broker fee | $350 | | Total landed cost | $96,757 | | Cost per unit | $24.19 |

Duty as % of total cost: $13,280 ÷ $96,757 = 13.7% Effective duty rate: 16.6%

Comparison: Same product from China:

MFN rate: 16.6%
Section 301 rate: 7.5% (List 4A, apparel)
Total duty: $80,000 × 24.1% = $19,280
Additional cost vs Vietnam: $19,280 - $13,280 = $6,000 per shipment (or $1.50 per unit)

Scenario 3: Auto Parts from Mexico, USMCA-Qualified ($150,000 shipment)

Product: Automobile transmission parts (HTS 8708.40.75) Supplier: Monterrey, Mexico Incoterm: FOB Monterrey Value: $150,000 Truck freight: $1,500 (Monterrey to Houston distribution center) Insurance: $450 USMCA status: Qualified (supplier provided certification, 78% regional value content)

Step-by-step calculation:

Customs value: $150,000 (FOB)
HTS code: 8708.40.75 (parts of gearboxes)
Country of origin: Mexico
MFN rate: 2.5%
USMCA preferential rate: 0% (qualified)
Base duty: $150,000 × 0% = $0
MPF: $150,000 × 0.3464% = $519.60 (within min/max range)
HMF: Not applicable (truck freight, not ocean port entry)
Broker fees: $300

Total costs:

| Line Item | Amount | |-----------|--------| | Product cost (FOB) | $150,000 | | Truck freight | $1,500 | | Insurance | $450 | | Import duty (USMCA 0%) | $0 | | MPF | $520 | | HMF | $0 | | Broker fee | $300 | | Total landed cost | $152,770 |

Duty savings from USMCA: $150,000 × 2.5% = $3,750 per shipment

Annual savings (24 shipments): $3,750 × 24 = $90,000/year

Comparison: Same product without USMCA qualification:

Would pay MFN rate 2.5% = $3,750 per shipment
Total landed cost: $156,520 (2.5% higher)

Key insight: Even "low" MFN rates (2.5%) add up significantly for high-volume importers. Qualifying for FTA benefits is worthwhile even when base rates seem small.

Common Pitfalls and How to Avoid Them

1. Incorrect HTS Classification

Problem: Choosing the wrong HTS code results in paying incorrect duty rates—either overpaying or underpaying (with risk of penalties).

Example: Classifying a product under HTS 9403.30 (furniture, 0% MFN) when it should be HTS 9403.60 (wooden furniture, 0% MFN + 216% ADD from China).

Underpayment: $100,000 shipment should pay $216,000 ADD, but pays $0
Consequence: CBP assesses $216,000 back duties + $43,200-$86,400 penalties (20-40% of duties owed) + interest

Prevention:

Use USITC HTS lookup tool for all products
Consult licensed customs broker for complex or high-value items
Conduct periodic classification reviews (annually or when products change)
Maintain detailed product descriptions and technical specifications to support classifications
When in doubt, file a binding ruling request with CBP (free, provides legal certainty)

2. Missing Preferential Rate Opportunities

Problem: Paying standard MFN rates when products qualify for zero or reduced FTA rates.

Example: Importing $2M annually of Mexican-made products eligible for USMCA but not claiming preferential treatment.

Average MFN rate: 4%
Overpayment: $2M × 4% = $80,000 annually

Prevention:

Identify all FTA-eligible source countries in your supply chain
Request origin documentation from suppliers (USMCA certifications, FTA certificates)
Instruct customs broker to claim preferential treatment when applicable
Conduct annual FTA qualification audits for top products
Use duty calculators to identify savings opportunities

3. Forgetting ADD/CVD Rates

Problem: HTS lookup tools show MFN rates but don't automatically flag anti-dumping or countervailing duty cases.

Example: Importing wooden bedroom furniture from China, relying on HTS tariff rate (0% MFN).

Actual duty: 0% MFN + 7.5% Section 301 + 216% ADD = 223.5% total
$100,000 shipment: Should pay $223,500, but only budgets for $7,500 (Section 301)
Surprise: Additional $216,000 owed upon entry

Prevention:

Check CBP's ADD/CVD case list for all products and countries (especially China, Vietnam, South Korea, Taiwan)
Consult customs broker about ADD/CVD exposure for your product categories
When importing from countries with active cases, verify your specific product and supplier aren't covered
Consider sourcing from alternative countries not subject to ADD/CVD orders

4. Using Wrong Customs Value Basis

Problem: Including costs in customs value that should be excluded, or vice versa.

Common errors:

Including international freight in customs value (U.S. uses FOB-based valuation; freight is excluded)
Excluding assists (molds, tooling, engineering provided by buyer) that must be added to value
Incorrect allocation of royalties and license fees

Example: Including $5,000 freight in customs value on $100,000 shipment with 25% duty rate.

Overpayment: ($105,000 - $100,000) × 25% = $1,250 per entry
Annual impact (50 entries): $62,500 overpayment

Prevention:

Understand valuation rules for your Incoterms (FOB excludes freight; CIF includes but U.S. typically excludes for duty purposes)
Disclose assists to customs broker (tooling, molds, dies, engineering)
Properly allocate royalties and license fees
Request valuation review from customs broker or trade attorney

5. Not Monitoring Tariff Rate Changes

Problem: Tariff rates can change with minimal notice (Section 301 rates, new ADD/CVD cases, FTA phase-outs).

Example: Section 301 List 3 tariffs increased from 10% to 25% in May 2019, then reduced to 7.5% in February 2020. Importers not monitoring changes:

Budgeted for 10% rate, actual rate 25% → 15-percentage-point surprise
Or paid 25% when rate dropped to 7.5% → 17.5-percentage-point overpayment (recoverable via protest, but delayed)

Prevention:

Subscribe to CBP, USTR, and ITA email alerts for trade policy updates
Monitor industry associations (USCIB, NRF, RILA) for tariff news
Schedule quarterly tariff rate reviews with customs broker
Use Ballast prediction markets to monitor and hedge tariff rate change risks

6. Inadequate Country of Origin Documentation

Problem: CBP requests proof of origin, but importer lacks documentation from suppliers.

Consequence:

Entry delayed while documentation is obtained (incurring demurrage and storage fees)
If documentation cannot be provided, CBP may reject preferential FTA claim and assess MFN rate + interest
For Section 301 purposes, inability to prove non-Chinese origin results in Section 301 tariff assessment

Prevention:

Require suppliers to provide country of origin declarations with each shipment
For FTA claims, obtain required certifications (USMCA certification, Korea FTA certificate) before claiming preferential treatment
Maintain factory audit records, bills of materials, production records supporting origin claims
For high-risk products (transshipment concerns), conduct periodic factory visits and document production processes

7. Choosing HTS Codes Based on Lowest Rate

Problem: Selecting an HTS code because it has a lower duty rate, even though product doesn't fit the classification description.

Consequence: This is tariff fraud—intentional misclassification to evade duties.

Criminal penalties (fines up to $500,000, imprisonment up to 20 years)
Civil penalties (2-4× the loss of revenue)
Loss of import privileges
Seizure and forfeiture of goods

Prevention:

Always classify based on product characteristics, not desired duty rate
Apply General Rules of Interpretation objectively
Document rationale for classification decisions
When legitimate alternative classifications exist, choose the most specific one that fits the product
Never artificially manipulate product descriptions or characteristics solely to achieve lower duties

8. Not Understanding Total Landed Cost

Problem: Focusing only on product cost and freight, failing to account for duties, fees, and broker charges.

Example: Product cost $50/unit, freight $2/unit. Importer prices product assuming $52/unit landed cost.

Actual landed cost: $50 + $2 freight + $15 duty (25% Section 301 on $60 customs value including freight) + $0.50 fees = $67.50/unit
Margin erosion: Priced assuming $52, actual cost $67.50 → 30% cost overrun

Prevention:

Calculate total landed cost including all duties, fees, insurance, broker charges
Build landed cost models for each product and update quarterly
Factor duty costs into pricing, margin analysis, and supplier negotiations
Use spreadsheet templates or landed cost calculators to ensure all cost elements are captured

Duty Mitigation Strategies

Importers have several legal strategies to reduce import duty costs:

1. Claiming Preferential Tariff Rates (FTAs)

Strategy: Source from FTA partner countries and ensure products meet rules of origin to qualify for zero or reduced tariff rates.

Applicable FTAs: USMCA (Mexico, Canada), Korea FTA, Chile, Colombia, Peru, Australia, Singapore, and 10 other bilateral FTAs.

Example: Auto parts from Mexico (USMCA 0%) vs China (MFN 2.5% + Section 301 25% = 27.5% total).

$5M annual imports: $1.375M annual duty savings by sourcing from USMCA-qualified Mexican suppliers

Requirements:

Verify products meet FTA rules of origin (tariff shift, regional value content, or wholly obtained)
Obtain required certifications from suppliers
Claim preferential treatment when filing entry
Maintain records for 5 years

When to use: When FTA partner countries offer competitive pricing and product quality, and products meet origin requirements.

2. Accurate HTS Classification (Avoiding Overpayment)

Strategy: Ensure products are classified in the most specific, appropriate HTS code—not a more general code with a higher duty rate.

Example: Industrial machinery component could be classified under:

General machinery parts (HTS 8479.90, 2.5% MFN)
Specific machinery type (HTS 8428.90, free)

Choosing the correct, more specific code (8428.90) saves 2.5%.

On $3M annual imports: $75,000 annual savings

Requirements:

Detailed product specifications and technical documentation
Understanding of HTS structure and General Rules of Interpretation
Consultation with customs broker or trade attorney for high-value products
Binding ruling request from CBP for legal certainty (free, provides 5-year protection)

When to use: Always. Correct classification is both a legal obligation and cost-saving opportunity.

3. Tariff Engineering

Tariff engineering involves modifying products or importing components separately to qualify for lower HTS codes, then assembling in the U.S.

Example: Importing assembled furniture (HTS 9403.60, 0% MFN + potential ADD) vs importing furniture components (various HTS codes, lower rates), then assembling domestically.

Legal boundaries:

✅ Legal: Genuine product modifications that change characteristics, form, or function
✅ Legal: Importing components and assembling in U.S. (shifts origin to U.S., avoids Section 301)
❌ Illegal: Artificial changes solely to manipulate classification without meaningful difference
❌ Illegal: Describing products inaccurately to fit lower-duty HTS codes

When to use: When product modifications are commercially viable, assembly costs are lower than duty savings, and changes don't negatively impact product quality or market acceptance.

Risk: Aggressive tariff engineering can trigger CBP audits. Always document legitimate business reasons for product modifications beyond duty savings.

4. Country Diversification

Strategy: Shift sourcing from high-tariff countries (e.g., China with Section 301 tariffs) to lower-tariff alternatives (Vietnam, Mexico, India).

Example: Electronics components from China (25% Section 301) vs Vietnam (0%).

$10M annual imports: $2.5M annual duty savings by shifting to Vietnam

Considerations:

Product quality and manufacturing capability in alternative countries
Lead times and logistics costs
Supplier relationships and reliability
Minimum order quantities and tooling costs to switch suppliers

When to use: When Section 301 or other country-specific tariffs create significant cost disadvantages, and alternative sources offer comparable quality and total costs.

Risk: Ensure alternative sourcing represents genuine production in the new country, not transshipment of Chinese goods (CBP actively investigates transshipment schemes).

5. Foreign Trade Zones (FTZ)

Foreign Trade Zones are designated areas in the U.S. where foreign and domestic goods are considered outside U.S. Customs territory for duty purposes.

Benefits:

Duty deferral: Import goods into FTZ, pay duties only when goods leave FTZ and enter U.S. commerce (improves cash flow)
Duty elimination on re-exports: Import into FTZ, process or repackage, export—never pay U.S. duties
Inverted tariff relief: If finished goods have lower duty rates than components, import components into FTZ, assemble, pay lower finished goods rate when entering U.S. commerce
No duties on waste/scrap: Components damaged or scrapped in FTZ don't incur duties

Example: Electronics importer brings $20M of components into FTZ, assembles finished products, exports 40% and sells 60% domestically.

Only pay duties on $12M entering U.S. commerce (60%)
Save 100% of duties on $8M exported (40%): $2M+ annual duty savings (assuming 25% average rate)

Requirements:

Operate or use space in an activated FTZ (300+ FTZs across U.S.)
Comply with FTZ recordkeeping and admission/removal procedures
File FTZ application and obtain approval for FTZ operations

When to use: High import volumes with partial re-export, inverted tariff situations, need for duty deferral cash flow benefits.

6. Duty Drawback

Duty drawback allows you to recover 99% of duties paid on imported goods that are:

Exported (unused or incorporated into exported products)
Destroyed under CBP supervision
Used in manufacturing products that are exported

Types of drawback:

Unused merchandise drawback: Import, pay duty, export unused → recover 99% of duties
Manufacturing drawback: Import components, pay duty, manufacture into finished goods, export → recover 99% of duties on imported components
Rejected merchandise drawback: Import, pay duty, goods rejected/returned, re-export → recover 99% of duties

Example: Importer pays $500,000 annual duties on components used in manufacturing. 30% of finished goods are exported.

Drawback recovery: $500,000 × 30% × 99% = $148,500 annual recovery

Requirements:

File drawback claims within 5 years of import
Maintain detailed records linking imported goods to exports
Comply with complex drawback regulations and filing procedures
Typically requires customs broker or drawback specialist to file claims

When to use: When you export imported goods (unused or as part of manufactured products), high duty rates make recovery worthwhile, sufficient volume justifies filing costs.

7. Hedging Tariff Risk with Prediction Markets

Strategy: Use prediction markets to hedge financial exposure to tariff rate increases, protecting profit margins and cash flow.

How it works:

Identify tariff exposure (e.g., $5M annual imports subject to Section 301 tariffs)
Hedge against tariff rate increases using Ballast prediction markets
If tariffs increase, hedge pays out to offset increased duty costs
If tariffs decrease or remain stable, you pay hedge cost but benefit from lower/stable duties

Example: Importer has $5M annual exposure to Section 301 tariffs currently at 7.5%. Risk: Tariffs increase to 25%.

Potential additional cost: $5M × (25% - 7.5%) = $875,000
Hedge cost: $50,000 (hypothetical premium)
If tariffs increase to 25%: Hedge pays $875,000, offsetting duty increase
If tariffs remain 7.5%: Pay $50,000 hedge cost, but no duty increase

When to use: Significant exposure to policy-driven tariffs (Section 301, Section 232), concern about tariff increases impacting margins, desire for budget certainty.

Benefit: Unlike duty mitigation strategies that require operational changes (sourcing shifts, FTZ setup), hedging provides financial protection without disrupting supply chains.

Explore tariff hedging options →

Case Study: Furniture Importer Optimizes Duty Costs

Company Profile: Mid-market furniture importer, $12M annual revenue, sources wooden bedroom furniture from China and Vietnam.

Initial Situation (2022):

100% sourced from China: $8M annual imports
HTS 9403.60 (wooden bedroom furniture)
MFN rate: 0%
Section 301 rate (List 3): 7.5%
ADD rate (case A-570-890): 216.01% (certain Chinese producers)
Total duty rate: 223.51%
Annual duties paid: $8M × 223.51% = $1,788,080

Problems:

Duty costs exceeding product costs (223% duty on 100% FOB value)
Eroding margins (duties consuming 18% of revenue)
Cash flow strain (large duty payments due within 10 days of entry)
Competitive disadvantage vs importers sourcing from non-ADD countries

Solution Implemented (2023-2024):

Phase 1: Country Diversification

Shifted 70% of sourcing to Vietnam (no Section 301, no ADD)
Maintained 30% China sourcing for specific designs not available in Vietnam

Phase 2: Vietnam Sourcing Optimization

Conducted factory audits to ensure genuine Vietnamese origin (not transshipped Chinese goods)
Documented supply chain (lumber sourcing, production processes, factory capabilities)
Maintained detailed origin records to support CBP verification if requested

Phase 3: China Sourcing Optimization

Verified Chinese supplier not subject to ADD (producer-specific rates vary; some producers have 0% ADD)
For supplier subject to ADD, negotiated price reduction to partially offset duty cost

Results After Implementation:

Vietnam imports ($5.6M, 70% of volume):

MFN rate: 0%
Section 301: Not applicable
ADD: Not applicable
Duties: $0

China imports ($2.4M, 30% of volume, from non-ADD supplier):

MFN rate: 0%
Section 301 rate: 7.5%
ADD: Not applicable (supplier not covered by case)
Duties: $2.4M × 7.5% = $180,000

Total annual duties: $180,000 (down from $1,788,080)

Annual savings: $1,608,080 (90% reduction in duty costs)

Additional benefits:

Improved margins: Gross margin increased from 22% to 35% (13-percentage-point improvement)
Better cash flow: Duty payments reduced from $149,000/month to $15,000/month
Competitive pricing: Reduced landed costs allowed 8% retail price reduction, increasing market share
Reduced CBP risk: Eliminated exposure to ADD penalties and scope expansions

Investment required:

Vietnam supplier qualification and factory audits: $25,000
Tooling and samples at new suppliers: $75,000
Customs broker consultation and origin documentation: $15,000
Total one-time cost: $115,000

Payback period: $115,000 ÷ $1,608,080 annual savings = 0.86 months (less than 1 month)

Key lessons:

ADD/CVD dramatically impacts landed costs and must be checked separately from HTS tariff rates
Country diversification can yield massive duty savings when products are subject to country-specific tariffs
Supplier qualification requires investment but payback is rapid for high-duty scenarios
Origin documentation is critical to defend sourcing claims during CBP verification

Frequently Asked Questions

How do I calculate import duties on goods from China?

Calculate customs value (FOB + freight + insurance if CIF), find the 10-digit HTS code for your product, apply MFN tariff rate, add applicable Section 301 additional duties (7.5-100% depending on product and List designation), calculate Merchandise Processing Fee (0.3464% of value, min $27.75, max $614.35), and Harbor Maintenance Fee (0.125% of value). Total duties = (Value × MFN rate) + (Value × Section 301 rate) + MPF + HMF.

What is an HTS code and how do I find it?

The Harmonized Tariff Schedule (HTS) code is a 10-digit classification number that determines duty rates and regulatory requirements for imported products. Use the USITC online HTS lookup tool at hts.usitc.gov, search by product description or keyword, and apply General Rules of Interpretation (GRI) to select the most specific classification. Consult a licensed customs broker for complex products.

What are Section 301 tariffs and which products do they affect?

Section 301 tariffs are additional duties imposed on Chinese imports in response to trade practices. Four Lists exist: List 1 (25% on $34B of goods including machinery, electronics), List 2 (25% on $16B including semiconductors, plastics), List 3 (7.5% on $200B including consumer goods, furniture), and List 4A (7.5% on $300B including apparel, footwear). Check USTR's tariff list or consult your customs broker for product-specific rates.

How can I reduce import duties legally?

Legal duty mitigation strategies include: claiming preferential tariff rates under free trade agreements (USMCA, Korea FTA, etc.), ensuring accurate HTS classification to avoid overpayment, sourcing from FTA partner countries, tariff engineering (modifying products to qualify for lower-duty HTS codes), using Foreign Trade Zones for deferred duty payment, and filing duty drawback claims for re-exported goods.

What is the Merchandise Processing Fee (MPF)?

MPF is a fee charged by U.S. Customs and Border Protection for processing formal entries (commercial imports over $2,500). The rate is 0.3464% of cargo value with a minimum of $27.75 and maximum of $614.35 per entry. MPF is charged in addition to import duties and applies to nearly all commercial imports regardless of tariff rate.

What is the difference between MFN and preferential tariff rates?

MFN (Most Favored Nation) rates are standard duty rates applied to imports from World Trade Organization (WTO) member countries. Preferential rates are lower or zero rates available under free trade agreements like USMCA (Mexico/Canada), Korea FTA, or other bilateral agreements. Products must meet rules of origin requirements to qualify for preferential rates.

How do I know if my imports qualify for free trade agreement benefits?

Check if your supplier's country has an FTA with the U.S. (USMCA, Korea FTA, etc.), verify your product meets the agreement's rules of origin (minimum percentage of originating content, production requirements), obtain required origin documentation (USMCA certification, FTA certificate of origin), and claim preferential treatment when filing entry with CBP. Consult your customs broker for qualification analysis.

What is customs valuation and why does it matter?

Customs valuation is the process of determining the value of imported goods for duty calculation purposes. The primary method is Transaction Value (price paid or payable), but may include freight, insurance, packing costs, and certain assists. Accurate valuation is critical because duties are calculated as a percentage of customs value. Undervaluation can result in penalties of 2-40% of duties owed plus interest.

Are anti-dumping and countervailing duties included in HTS rates?

No. Anti-dumping duties (ADD) and countervailing duties (CVD) are additional duties imposed on specific products from specific countries to offset unfair pricing or foreign government subsidies. These duties can range from 10% to over 300% of value and are charged in addition to MFN/preferential rates and Section 301 tariffs. Check CBP's ADD/CVD case list or consult your broker.

How often do tariff rates change?

MFN tariff rates in the HTS are relatively stable, with updates published annually on January 1. However, additional duties like Section 301, Section 232 (steel/aluminum), ADD/CVD, and trade remedy cases can change with little notice. Presidential proclamations can add or remove tariffs within days. Monitor USTR announcements and consult your customs broker regularly.

Can I get a refund if I overpaid import duties?

Yes, through protest or duty drawback. File a protest with CBP within 180 days of liquidation if you believe duties were incorrectly calculated. If successful, CBP will issue a refund plus interest. Duty drawback allows you to recover duties on goods that are exported, destroyed, or used in manufacturing exported products (filed within 5 years of import).

What is the Harbor Maintenance Fee and when is it charged?

The Harbor Maintenance Fee (HMF) is 0.125% of cargo value, charged on commercial shipments arriving at U.S. ports (ocean and Great Lakes, not airports). HMF funds maintenance and dredging of U.S. harbors. It's charged in addition to import duties and MPF. For a $100,000 shipment, HMF is $125.

How do I calculate landed cost including all duties and fees?

Landed cost = Product cost (FOB) + Freight + Insurance + Import duties + Section 301/232 tariffs + ADD/CVD (if applicable) + MPF + HMF + Customs broker fees. For example: $100,000 goods from China (25% Section 301 tariff, 0% MFN) = $100,000 + $3,000 freight + $300 insurance + $0 MFN + $25,000 Section 301 + $347 MPF + $125 HMF + $400 broker fee = $129,172 total landed cost.

Do I pay import duties on goods from Canada and Mexico?

It depends. Under USMCA (formerly NAFTA), many products qualify for zero tariff rates if they meet rules of origin requirements. Your supplier must provide a USMCA certification of origin. If goods do not qualify for USMCA treatment, standard MFN tariff rates apply. Even with zero tariffs, you still pay MPF ($27.75 minimum) on formal entries over $2,500.

What online tools can I use to calculate import duties?

Use the USITC HTS online lookup tool (hts.usitc.gov) for official tariff rates by HTS code. USA Trade Online (Census Bureau, subscription required) provides historical import data and duty rates. Commercial tools like SimplyDuty and Duty Calculator offer estimation (verify rates independently). For Section 301 tariffs and complex scenarios, consult a licensed customs broker or use Ballast Markets for tariff rate forecasts.

Master import duty calculation to optimize your landed costs, ensure compliance, and maintain healthy margins. Understanding how tariffs vary by country, product, and trade policy is essential for every importer.

Next steps:

Ballast Markets provides prediction markets for tariff rates, trade policy outcomes, and supply chain risks—helping importers, exporters, and logistics providers hedge financial exposure to global trade volatility. This content is for educational purposes only and does not constitute legal, financial, tax, or trade compliance advice. Consult licensed customs brokers, trade attorneys, and tax professionals for specific import requirements and duty optimization strategies.