Hi folks -
So today's post is going to be a little bit drab. ^_^ I've been working on an application for a Production job at a clothing company I love, so have been spending the past few days brushing up and preparing. Today's homework assignment is: learning how to calculate import duty rates for items coming into the US. (focused on textile imports)
Are you still with me? :)
US Customs and Border Protection, or CBP
So, the US Customs and Border Protection (CBP), is the national body overseeing movement of goods into and out of US borders. Their website provides some basic information about importing and exporting goods to / from the US.
There is no general license requirement to import items into the US, but you may need one depending on what you're importing. For textiles (including fabrics and ready-made apparel), you'll have to pay attention to flammability requirements, as well as ensuring that apparel labels specify content and country of origin.
You'll also want to know and contact the port of entry where your goods will be entering the US. For textiles, there are import quota controls that limit the quantity of goods that can enter the US during a specific time period. You can find these on the CBP Quotas page.
Additional resources from the CBP:
Entry of Goods Into the US
When your goods reach the US, you'll need to file entry documents with the port of entry. You need to file two types of documents: 1) to determine whether items can be released from CBP custody, and 2) to report information for duty assessment and CBP tracking. These can be done through the ACS here.
You might be applying for an immediate release of shipment, or for entry for warehouse (where goods can be held up to 5 years until withdrawn for consumption). I will focus on the latter here, which is generally more applicable for textiles.
Determining Duty Rates
Goods can be withdrawn from a warehouse once you have paid the appropriate duty rate. To calculate what this will be, you use the Harmonized Tariff System (HTS). There are a lot of factors that go into this classification system, so make sure you have as much information as possible to get the correct estimation of what rate you'll need to pay. In the end, the CBP makes the final determination of what the correct rate of duty is.
You can find the complete HTS classification system here; Textiles are Section XI, and start with chapter 50 on silk. Once you've found the correct line item that best describes your item, you'll be able to see the associated duty rates. There are three columns: the general rate of duty, special rate of duty, and column 2 rate of duty.
"Generally" speaking, you'll be looking at the general rate of duty, as this applies to the widest number of countries. The special rate of duty applies for certain countries that are subject to special trade agreements with the US, and these are typical listed. The column 2 rate of duty shows the maximum duty rate for each line item.
Well folks, that's it for my introduction to importing textiles into the US today. Please let me know if I missed anything major!