When goods are imported into the USA, the thing to worry about is not sales tax, but customs duties. This is a tax imposed on goods when transported across international borders and in the US, this is governed federally by U.S. Customs and Border Protection (“CBP”). The simplest way to think about import duties is as the entrance fee you are being charged by the US government to allow your goods into their country.
All goods imported into the USA are subject to duty (or might be classified as duty-free) based on a list of product types published and updated regularly by CBP. When goods are dutiable, a tax will be imposed as a percentage of the value of the merchandise. Therefore, importers are expected to declare attributes of their imported goods to CBP. Typically, when goods are shipped into the US, the importer (or her agent) must complete documents disclosing the nature, value, origin, and other information about the goods. The CBP will inspect the goods and charge estimated duties on the value of the goods.
When a shipment reaches a US port of entry, the importer of record (i.e., the owner, purchaser, or licensed customs broker designated by the owner, purchaser, or consignee) will file entry documents for the goods with the port director. Imported goods are not legally entered until after the shipment has arrived within the port of entry, delivery of the merchandise has been authorised by CBP, and estimated duties have been paid. It is the importer of record’s responsibility to arrange for examination and release of the goods.
Most international carriers will assist with the customs compliance procedures, and some will act as the importer of record. Once the goods have cleared customs and the import tax has been paid, they are free to be stored, sold or distributed across the state – and this is when additional tax obligations might arise. (For example, the seller may be deemed to have sales tax nexus and might have to register with one or multiple states).
Here are 5 tips to guarantee faster clearance of your merchandise in the USA:
1. Include all information required on your customs invoices and prepare your invoices carefully.
2. Make sure that your invoices contain the information that would be shown on a well- prepared packing list and mark and number each package so it can be identified with the corresponding marks and numbers appearing on your invoice.
3. Show a detailed description on your invoice of each item of merchandise contained in each individual package.
4. Comply with the provisions of any special laws of the United States that may apply to your goods, such as laws relating to food, drugs, cosmetics, alcoholic beverages, radioactive materials, and others.
5. Consider shipping on a carrier participating in the Automated Manifest System (AMS) or If you use a licensed customs broker for your transaction, consider using a firm that participates in the Automated Broker Interface (ABI)