U.S. Import Duties, Taxes and Fees, Explained

When cargo enters the United States, the government does not charge one flat “import tax.” It charges a stack of separate line items: the duty itself, one or two federal processing fees, and in many cases extra tariffs tied to the product’s country of origin. Each is calculated a different way, and confusing them is the most common reason an importer’s landed cost estimate turns out wrong.

This guide breaks the stack apart the way a customs broker reads it on an entry. It covers how duty is actually calculated, how U.S. Customs and Border Protection (CBP) values your goods, what the Merchandise Processing Fee and Harbor Maintenance Fee are, when the $800 de minimis threshold means you owe nothing, and when duty applies at all. The figures and rules below reflect U.S. import law, the same framework we apply on every entry cleared at the San Diego and Otay Mesa border.

The four things that can be charged on a U.S. import

A U.S. import can carry up to four distinct charges, and it helps to see them as separate buckets rather than one bill. First is the customs duty, set by the product’s classification. Second is the Merchandise Processing Fee (MPF), a federal fee on the paperwork. Third is the Harbor Maintenance Fee (HMF), which applies only to ocean shipments. Fourth is any special or additional tariff tied to the product or its origin, such as Section 301, Section 232, or antidumping duties.

One thing that surprises importers coming from Mexico or Europe: the United States has no federal value-added tax on imports. There is no equivalent of Mexico’s IVA or the EU’s VAT collected at the border by CBP. You pay duty and fees, not a national consumption tax. Any state or local sales tax is a separate matter handled when the goods are later sold, not something CBP collects at entry.

Every one of these charges is the legal responsibility of the importer of record, the party in whose name the goods are entered. The customs broker files the entry and can advance the money, but the duty liability and the accuracy of the declaration rest with the importer of record, not the broker and not the foreign seller.

How duty is calculated: HTS rate times customs value

The core formula is simple: duty equals the duty rate multiplied by the customs value. Everything difficult about it lives inside those two numbers.

The duty rate comes from the product’s classification in the Harmonized Tariff Schedule of the United States (HTSUS), a 10-digit code that maps every possible good to a specific rate. Rates come in three forms. An ad valorem rate is a percentage of value, for example 6.5 percent. A specific rate is a fixed charge per unit, for example a set amount per kilogram or per dozen. A compound rate combines both. Classification is where importers get into trouble, because a small difference in the code can mean the difference between duty-free and a double-digit rate, and misclassification is the importer’s liability even when it was an honest error.

The customs value is normally the transaction value, meaning the price actually paid or payable for the goods when sold for export to the United States. Multiply the correct HTS rate by the correct customs value and you have the duty. If the HTS rate is specific rather than ad valorem, value does not drive the duty but still drives the fees below.

• Ad valorem: a percentage of the customs value (the most common form)
• Specific: a fixed amount per unit of quantity, independent of price
• Compound: a percentage plus a per-unit amount, both applied
• Free: many goods carry a 0 percent rate, but still owe MPF and, for ocean cargo, HMF

How CBP values your goods

U.S. customs value is built on transaction value, the price paid or payable for the merchandise. Critically for landed-cost math, the United States values imports on an FOB basis (the value at the foreign port of export), not a CIF basis. That means international freight and insurance are generally excluded from the dutiable value, unlike in many countries that tax the delivered value. This is one of the biggest differences importers miss when comparing U.S. and foreign customs.

Transaction value is not always just the invoice price. CBP requires certain additions when they are not already included, commonly called statutory additions. These include assists (tooling, molds, dies, or materials you supplied to the manufacturer for free or at reduced cost), packing costs, selling commissions, and certain royalties or license fees that are a condition of the sale. Leaving these out understates value and understates duty, which CBP can recover later with interest.

When transaction value cannot be used, for example between related parties where the price was influenced by the relationship, CBP applies a fixed hierarchy: transaction value of identical goods, then similar goods, then deductive value, then computed value, then a reasonable fallback method. Brokers work down that ladder in order; you cannot simply pick the method that produces the lowest number.

MPF and HMF: the two standard federal fees

The Merchandise Processing Fee is charged on most formal entries at an ad valorem rate of 0.3464 percent of the customs value. It is not open-ended: it has a minimum and a maximum per entry, both of which CBP adjusts annually for inflation, so a very small shipment pays the floor and a very large one is capped at the ceiling. Informal entries (generally low-value shipments) carry a lower set MPF instead of the percentage. MPF applies even when the duty rate is zero, which is why “duty-free” does not mean “fee-free.”

The Harbor Maintenance Fee is 0.125 percent of the cargo value and funds the maintenance of U.S. ports and harbors. The key limitation is the mode of transport: HMF applies only to goods arriving by ocean vessel. It does not apply to air freight, and it does not apply to goods crossing by truck or rail. That last point matters directly at Otay Mesa, where cargo entering by truck from Mexico pays MPF but not HMF, because there is no ocean port call involved.

Both fees are collected by CBP at entry and are separate from the duty. On a typical formal entry you should expect to see three lines at minimum: duty, MPF, and (for ocean cargo only) HMF, before any special tariffs are added on top.

• MPF: 0.3464 percent of value on formal entries, subject to an annually adjusted minimum and maximum per entry
• MPF still applies to duty-free goods and to goods under a free trade agreement
• HMF: 0.125 percent of value, ocean shipments only, with no minimum or maximum
• Truck and rail crossings at Otay Mesa owe MPF but are not subject to HMF

Section 321 de minimis: when you owe nothing

U.S. law provides a de minimis exemption under Section 321 of the Tariff Act. Shipments valued at $800 or less, sent to one person on one day, may generally enter free of duty and tax and with minimal formality. This is the provision that allows most low-value e-commerce parcels to clear without a formal entry, duty, or MPF.

The threshold is $800 in fair retail value in the country of shipment, applied per consignee per day. Splitting one order into multiple parcels to stay under $800, or consolidating many buyers’ goods to claim multiple exemptions improperly, is treated as circumvention and can void the exemption.

Important caveat: de minimis is a policy lever, and its scope has been the subject of active regulatory and executive action, including restrictions and suspensions affecting goods of certain origins. Because the rules here can change on short notice, treat the $800 figure as the statutory baseline and confirm the current status for your specific goods and country of origin before relying on it. Certain products are also excluded from de minimis regardless of value, for example goods subject to some partner-government agency requirements or to antidumping and countervailing duty orders.

When duties apply, and the extra tariffs that stack on top

Whether an entry is formal or informal turns largely on value. Shipments valued above $2,500 generally require a formal entry, which means a customs bond, a filed entry summary, and full duty and fee payment. Shipments at or below $2,500 can often be handled as informal entries with less paperwork, and shipments at or below $800 may qualify for the de minimis treatment described above. A formal entry above $2,500 also requires a customs bond, either a single-entry bond for a one-time shipment or a continuous bond (activity code 1) for importers who bring goods in regularly.

Beyond the standard duty, many imports now carry additional trade-remedy tariffs that are calculated on the same customs value and added on top. Section 301 tariffs target specific goods from China. Section 232 tariffs cover certain steel and aluminum products. Antidumping and countervailing duties (AD/CVD) apply to specific products from specific countries found to be unfairly priced or subsidized, and these can be far larger than the base duty rate. Additional tariffs imposed under other authorities may also apply depending on origin and product.

The practical takeaway is that the base HTS rate is only the starting point. A correct landed-cost estimate has to check the full stack for the exact classification and country of origin, then add MPF and, for ocean cargo, HMF. That is the analysis a broker runs before goods move, and it is where getting the classification and origin right pays for itself.