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Import Tariffs from China to US: How much I have to Pay for the US Import Customs Duty?

As a toy importer, do you go to great lengths to import high-quality and affordable toy products from all over the world? Have you heard that China is a big exporter of toys? Do you want to import toy products from China but worry about the related tariff issues? If you, as an importer, want to import toys from China and sell them in the United States, there are some import tariffs on wholesale toys that you need to know. This article will tell you how much you should pay for the US import customs duty.

How Are U.S. Tariffs Levied? What Is the Formula for Calculating Tariffs?

First of all, the chart below is for reference only about the different types of goods entering the United States.

Import Tariffs of Different Goods

Definitions

Section 321: Bill 321 refers to the adjustment of the minimum tariff threshold from $200 to $800 in order to facilitate the conduct of the trade bill during the Obama administration.

Tax Free: No Tax / No Import Fee

Informal: Informal customs clearance

Formal: Formal customs declaration

Taxable: Customs

MPF: Commodity Handling Fee

Now you fundamentally have a basic understanding of what import tariffs are levied and when they are exempt.

U.S. Tariffs Levy (Declaration Value)

Commodity declared value

Under $800: The import tariffs are free.

Between $800-2500: It belongs to informal customs clearance and you only need to pay customs duties. There is no cargo handling fee.

Value over $2500: You need to apply for regular customs clearance and then pay customs duties and MPF. (Note: The calculation method of anti-dumping products and countervailing products is different from the above)

Tariff Calculation Formula

What is the meaning of import tariffs calculation formula? Here is the below chart as answer.

Calculation Formula

MPF= FOB x cargo operation tax rate (the tax rate is generally 0.3464%, the minimum MPF is 25.67 US dollars, and the highest is 497 US dollars)

FOB Price: value of goods

How to Calculate the Import Tariffs When Shipping from China to the US?

Check HTS Code/Customs Tariff Code

The first step is to visit the Harmonized Tariff Schedule and check the HTS code to find out the tariff rate for a specific product/category.

Let’s take an example of a pet toys: (Assuming unit price FOB NINGBO 3.00, order 5000PCS from China factory, total value $15000.00)

We enter “pet toys” in the search bar, and the search results are as follows:

You’ll see different HTS codes in the search results (left column), so you’ll want to check the different descriptions to see what works best for your nitch.

Find Out the Tariff Rate

As can be seen from the above figure, according to the official website, the product (pet toys) tariff rate is 4.3%.

Now that we have completed our primary tariff study on pet toys, which is 4.3%, there are no other tariffs on this product.

The duty is calculated by multiplying the declared value by the duty rate.

Take pet toys as an example:

Tariff rate: 4.3%

Declared Value” $15000.00

Primary duty/duty on 5000 pet toys imported from China to the US: 15000*0.043= $645.00

Tariff Calculator Free Tool (Import Tariffs Calculator)

You can also use the free US import duty calculator when calculating import tariffs and duties.

Tariff calculator free tool: Simple Duty. The Tariff Calculator is for reference only when viewing U.S. tax rates.

Other Fees When Importing From China: MPF

How to obtain the HTS code and calculate the US import duties has been described above. Now there is also the question of whether there are other taxes and fees to be paid when importing toy products from China.

Here is an example: MPF.

What is MPF: It refers to the commodity handling fee.

On August 1, 2019, U.S. Customs and Border Protection (CBP) announced in a Federal Register Notice (FRN) that various charges under the Omnibus Budget Reconciliation Act of 1985 (COBRA), including the Merchandise Handling Fee (MPF) )) to make changes.

In the FRN, CBP stated that the MPF ad valorem tax rate of 0.3464% would not change, but the minimum and maximum formal entries would become $26.79 and $519.76, respectively. The changes are scheduled to take effect on October 1, 2019.

Still using pet toys for your reference.

MPF = $15000 x 0.3464% = $51.96

So if you want to import 5000 pet toys from China to the US, then the total import tariffs (import tariffs from China) is $645.00+$51.96=$696.96

It’s worth reminding you that when you import toy products from overseas markets, be sure to consult your broker as they know best how to find the exact duty rate.

You can, of course, check on your own, but keep in mind that U.S. Customs will determine the final tariff rate for specific goods imported from China or other countries.

Landed Cost

Why is landed cost so important to import and export business? Because the landed cost covers all the expenses you incur in a particular shipment when you import the shipment.

Landed cost includes the value of the original Chinese item, agency service fees (depending on inspection or purchasing agent), all brokerage, shipping and logistics costs (international and domestic), insurance, US duties/duties, taxes, other handling charges.

Project Cost (by EXW/FOB Term)

EXW, FOB, CIF, CFR, FCA, DPU, DAP

Agency Fee (Inspection/Purchase)

If you do not use the Chinese purchasing agency service or specify the inspection of the goods, the agency fee is not included.

If you would like to have your toy product inspected by a third party or purchasing agent before shipping from China to the US, then add a fee.

Custom Clearance

The reference standard rate for customs clearance with CBP is approximately $100 to $120.

Shipping/Logistics Costs

When importing goods from China, it can be shipped by sea, express (DHL, UPS, FedEx) or by air. And this article will tell you more detail about it.

Insurance

If you are buying from a Chinese toy supplier under the CIF term, the price should include insurance for your item.

Import Tariffs/Customs

Duties are the actual amounts paid by an importer or exporter for imported or exported products. There is a difference between import tariffs and customs duties. Tariff refers to the tariff rate under the Harmonized Tariff System Code (HTS). Every imported product has a reference HTS code, which is how U.S. Customs determines the tariff rate that should be levied on a particular product.

The first and most critical part includes the landed cost.

The End

It is significant for all of the toys importers to know how much they should pay for the import tariffs while importing toys from China. If you are interested in toy importing from China, or want to know more details, welcome to visit our website unionvisionchart.com.

Hopes all things well, good luck~

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