Customs duties on imported goods are calculated by taking the value of the shipment, applying the duty rate tied to the goods’ tariff classification and country of origin, and then adding the processing fees and any special tariffs that apply. Three inputs drive the base number: what the goods are worth, how they are classified under the Harmonized Tariff Schedule, and where they were made. Everything else layers on top.
The importer of record is legally responsible for getting those inputs right. Under federal law, that role falls to the owner or purchaser of the goods, or to a licensed customs broker the owner, purchaser, or consignee designates.1Office of the Law Revision Counsel. 19 U.S. Code 1484 – Entry of Merchandise U.S. Customs and Border Protection collects the duties, taxes, and fees at the time of import.2U.S. Customs and Border Protection. Importing into the United States
The Three Inputs That Drive the Base Duty
Valuation
The primary method for valuing imported goods is transaction value: the price you actually paid or agreed to pay the seller when the goods were sold for export to the United States.3Office of the Law Revision Counsel. 19 U.S. Code 1401a – Value International shipping and insurance are not part of that price, but several other items are added to it:
- Packing costs the buyer paid for the imported goods.
- Any selling commission the buyer paid in connection with the purchase.
- Assists, meaning materials, tools, or engineering work the buyer provided to the seller free or at reduced cost to help produce the goods.
- Royalties and license fees the buyer must pay as a condition of the sale.
- Any portion of later resale proceeds that flows back to the seller.
When transaction value cannot be determined, federal law sets a strict order of fallback methods: the value of identical goods, then similar goods, then a deductive value working backward from the U.S. selling price, then a computed value built up from production costs, and finally a catch-all method.3Office of the Law Revision Counsel. 19 U.S. Code 1401a – Value You only move to the next method when the prior one cannot produce a reliable number.
Classification
Every product must be assigned a code from the Harmonized Tariff Schedule of the United States, which sets the tariff rate for imported merchandise.4U.S. International Trade Commission. Harmonized Tariff Schedule of the United States The HTSUS uses 10-digit codes built on the international Harmonized System that most trading nations share.5U.S. Customs and Border Protection. Harmonized Tariff Schedule – Determining Duty Rates A small difference in how a product is described can move it into a code with a significantly higher or lower rate.
If you are unsure which code applies, you can request a binding ruling from CBP before importing. The Office of Regulations and Rulings issues a decision that locks in your classification.6U.S. Customs and Border Protection. Binding Ruling Program One limit worth noting: the ruling binds the classification code, not the duty rate. Rates can still change through trade policy actions after your classification is settled.
Country of Origin
Where your goods were manufactured or substantially transformed determines the rate that applies. Country of origin is not necessarily the country the goods shipped from. If raw materials from one country are assembled into a finished product in another, the country of assembly is the origin for duty purposes.
Goods from countries with normal trade relations receive standard HTSUS rates. Goods from countries with a free trade agreement can qualify for reduced or zero rates. Goods from countries facing sanctions or special tariff actions can owe substantially more.
Processing Fees Added to Every Calculation
Most commercial shipments are subject to two fees on top of the duty itself.
Merchandise Processing Fee
CBP charges a Merchandise Processing Fee on formal entries. For fiscal year 2026, the MPF is 0.3464% of the goods’ value, excluding duty, freight, and insurance, with a minimum of $33.58 and a maximum of $651.50 per entry.7U.S. Customs and Border Protection. Customs User Fee – Merchandise Processing Fees Filing manually adds a $4.03 surcharge.
Harbor Maintenance Fee
Cargo arriving by sea and loaded or unloaded at a U.S. port also owes the Harbor Maintenance Fee at 0.125% of the cargo’s value.8U.S. Customs and Border Protection. What Is the Harbor Maintenance Fee (HMF)? The HMF applies to imports, domestic waterborne shipments, and foreign-trade zone admissions. It does not apply to cargo arriving by air, and it does not apply to exports.
Extra Tariffs That Stack on Top
The HTSUS rate is often just the starting point. In 2026, several categories of additional tariffs can be layered on top of the base duty.
Reciprocal Tariffs
Starting in April 2025, the United States imposed an additional 10% tariff on imports from all trading partners, with higher country-specific rates for certain nations.9The White House. Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices These reciprocal tariffs apply to the non-U.S. content of imported goods, provided at least 20% of the article’s value originates in the United States. For many importers, the 10% floor is now the single largest addition to their duty cost.
Section 232 Tariffs on Metals
Steel, aluminum, and copper face separate tariffs under Section 232 of the Trade Expansion Act. As of 2026, articles made entirely or almost entirely of these metals pay a flat 50% on their full value. Products that are substantially made of these metals but are not pure metal articles pay 25%. Certain industrial and electrical grid equipment qualifies for a reduced 15% rate through 2027.10The White House. Fact Sheet: President Donald J. Trump Strengthens Tariffs on Steel, Aluminum, and Copper Imports Products containing 15% or less steel, aluminum, or copper are exempt from Section 232 tariffs entirely.
Antidumping and Countervailing Duties
When a foreign producer sells goods in the U.S. below their cost of production, CBP can impose antidumping duties. When a foreign government subsidizes an industry to give it an unfair export advantage, countervailing duties offset that subsidy.11U.S. Customs and Border Protection. About AD/CVD The Department of Commerce investigates, the International Trade Commission determines whether U.S. industries were harmed, and CBP collects the resulting duties. These rates are product- and country-specific and sometimes exceed 100% of the goods’ value.
How the Layers Combine
Your total import cost can far exceed the base HTSUS rate. A steel product from a country subject to both Section 232 tariffs and reciprocal tariffs could face a combined effective rate well above 60% before any antidumping duties are considered.
Programs That Reduce or Eliminate the Duty
Free Trade Agreements
The United States has free trade agreements with 20 countries. Goods that meet an agreement’s rules of origin can enter at reduced or zero rates. The United States-Mexico-Canada Agreement, for example, allows importers to claim preferential treatment when products qualify as originating under the agreement’s rules.12eCFR. 19 CFR Part 182 – United States-Mexico-Canada Agreement You need documentation to prove origin, and CBP can verify those claims after entry.
Temporary Importation Under Bond
If you are bringing goods in temporarily and do not plan to sell them, a Temporary Importation under Bond lets you avoid paying duties. The goods must be exported or destroyed within three years of the date they were imported.13U.S. Customs and Border Protection. Temporary Importation Under Bond (TIB) The program covers goods brought in for repair, testing, exhibitions, or professional use. Missing the deadline triggers liquidated damages on top of the duties you would have paid.
Duty Drawback
If you import goods, pay duties on them, and then export those goods or products made from them, you can claim a refund of 99% of the duties you originally paid.14Office of the Law Revision Counsel. 19 USC 1313 – Drawback and Refunds The same 99% refund applies if the imported goods are destroyed rather than exported. Claims are filed electronically through CBP’s Automated Commercial Environment. Substitution is allowed in many cases if the imported and substituted merchandise share the same tariff classification.
Personal Exemptions for Travelers
Returning U.S. travelers can bring goods back for personal or household use up to certain limits without paying duty. The standard personal exemption is $800, with variations based on where you traveled.15U.S. Customs and Border Protection. Duty-Free Exemption You can bring back more, but you owe duty on the excess.
De Minimis Is No Longer Available
For years, commercial shipments valued at $800 or less could enter duty-free under the de minimis rule in 19 U.S.C. 1321.16Office of the Law Revision Counsel. 19 U.S. Code 1321 – Administrative Exemptions CBP suspended that exemption for all countries effective August 29, 2025.17U.S. Customs and Border Protection. Suspension of Duty-Free De Minimis Treatment A February 2026 executive order continued the suspension, requiring shipments (other than those through the international postal network) to be entered formally and to pay all applicable duties, taxes, and fees regardless of value.18The White House. Continuing the Suspension of Duty-Free De Minimis Treatment for All Countries Low-value goods that once entered free now go through the same calculation as any other formal entry.
What a Wrong Calculation Costs
Federal law imposes civil penalties scaled to the severity of the violation:
- Fraud: a penalty up to the full domestic value of the merchandise.
- Gross negligence: up to four times the duties the government was deprived of, or the domestic value of the goods, whichever is less. If the error did not affect the duty amount, the penalty can still reach 40% of the dutiable value.
- Negligence: up to two times the duties at stake, or the domestic value of the goods, whichever is less. If duties were not affected, up to 20% of the dutiable value.
Self-correction changes the math. If you discover an error and disclose it to CBP before a formal investigation begins, the penalty for negligence or gross negligence is limited to interest on the unpaid duties, as long as you pay what you owe at the time of disclosure or within 30 days of CBP’s calculation.19Office of the Law Revision Counsel. 19 U.S. Code 1592 – Penalties for Fraud, Gross Negligence, and Negligence Catching your own mistake and reporting it is far cheaper than waiting for CBP to find it.