How to Lower Your Import Duties (Legally)

01

Stop paying duty on international freight and insurance

Customs value is based on the price of the goods, not the cost of getting them here. The law defines that price as the payment for the goods, excluding the costs of transportation, insurance and related services for the international shipment to the United States (19 U.S.C. 1401a(b)(4)(A)).

If your supplier sells CIF (cost, insurance and freight), ask for an invoice that shows the goods, the ocean freight and the insurance as separate lines. Buying FOB, where the price stops at the port of export, keeps the ocean freight off the goods price from the start.

Freight inside the exporting country works differently. Trucking from the factory to the port stays in the value when it is part of the price, unless it is listed separately and happens after the goods are sold for export and handed to a carrier for through shipment to the United States (19 CFR 152.103(a)(5)).

List only real charges. CBP adds overstated freight back to the value.

Sources: 19 U.S.C. 1401a (transaction value); 19 CFR 152.103 (freight and inland charges)

02

Get the classification right, and lock it in with a binding ruling

Your duty rate comes from the product's HTS classification, and similar products can sit under codes with very different rates. The right code depends on what the product is, what it is made of and how it is used.

Look your product up in the calculator, then search CBP's rulings database (CROSS) for rulings on similar goods.

For certainty before you commit, you can ask CBP for a binding ruling on a future import (19 CFR 177.1). A ruling letter binds CBP until it is modified or revoked (19 CFR 177.9).

Pick the code that fits the product, not the one with the lowest rate. A code you know is wrong is a false statement to CBP.

Sources: CBP Customs Rulings Online Search System (CROSS); 19 CFR Part 177 (binding rulings, including 177.1 and 177.9)

03

Steel, aluminum and copper: know how Section 232 is charged

Since 12:01 a.m. EDT on April 6, 2026, the Section 232 duties on steel, aluminum and copper articles and their listed derivatives apply to the full customs value of the imported product, regardless of metal content (Proclamation 11021).

So a product's metal share no longer shrinks the Section 232 duty. What still matters is whether your product is on the lists at all and which rate applies: some reduced rates depend on where the metal was melted and poured or smelted, which your supplier has to document.

The calculator applies the current Section 232 rules for your HTS code and origin, so run the product before you order.

Source: Proclamation 11021, 91 FR 18201 (Federal Register)

04

List installation and assembly after import separately

If your purchase includes work done after the goods arrive in the United States, such as installation, assembly, maintenance or technical support, those charges are not part of customs value when they are identified separately from the price of the goods (19 U.S.C. 1401a(b)(3)).

The same goes for transportation after the goods are imported and for U.S. duties and federal taxes. Ask the seller to show these as separate line items. Folded into one price, they can end up in the dutiable value.

Source: 19 U.S.C. 1401a(b)(3)

05

Use the first sale price when you buy through a middleman

When a trading company buys from the factory and resells to you, you may be able to declare the factory's price to the middleman (the first sale) instead of the price you paid.

The first sale has to be at arm's length, and the goods have to be clearly destined for the United States when that sale happens. CBP presumes the price you paid is the right value, so the burden is on you to prove the first sale with the contracts, invoices and payment records for both sales (CBP ruling H005222, applying Nissho Iwai v. United States).

You need the middleman's cooperation, because their purchase price and documents are part of the proof.

Source: CBP ruling H005222 (first sale, Nissho Iwai standard)

06

Defer or avoid duty with a foreign-trade zone

Foreign-trade zones are secure areas under CBP supervision that are generally treated as outside U.S. customs territory. Duty is paid when goods leave the zone for sale in the United States, and goods exported from a zone pay no U.S. duty.

If goods are assembled or manufactured in a zone, the user can normally choose to pay the duty rate of the foreign parts or of the finished product, whichever works in their favor.

Recent tariff actions limit this. Goods subject to the Section 232 metals duties, for example, can be admitted to a zone only in privileged foreign status, which fixes their classification at admission (Proclamation 11021). Zone operations follow 19 CFR Part 146.

Sources: CBP: About Foreign-Trade Zones; 19 CFR Part 146 (foreign-trade zones); Proclamation 11021 (zone admission for metals)

07

Get duty back on goods you export or destroy

Drawback refunds duties, taxes and fees paid on imported goods that are later exported or destroyed, or used to make exported products (19 U.S.C. 1313). It covers ordinary duties as well as the Merchandise Processing Fee and the Harbor Maintenance Tax (19 CFR 190.3).

It never refunds antidumping or countervailing duties (19 CFR 190.3(b)), and some tariff actions restrict it: the Section 232 metals duties allow only limited manufacturing drawback (Proclamation 11021).

Claims follow strict filing and record rules, so drawback fits best when you export or destroy imported goods regularly.

Sources: 19 U.S.C. 1313 (drawback); 19 CFR 190.3 (what drawback covers)

08

Use trade agreements and exclusions

USMCA: goods that qualify as originating under the agreement's rules of origin can enter at preferential rates. The claim rests on a certification of origin, completed by the importer, exporter or producer, in any format, and it must be in your possession when you make the claim (19 CFR 182.12).

Other tariff actions can still apply to USMCA goods, so check the full duty stack in the calculator.

Section 301 exclusions: the U.S. Trade Representative excludes certain products of China from the Section 301 duties. The 178 current exclusions were extended through 11:59 p.m. Eastern on November 9, 2026 (90 FR 55232). Check whether your product and HTS code are on the list, and watch Tariff Radar for USTR's next decision.

Sources: 19 CFR 182.12 (USMCA certification of origin); CBP: USMCA; 90 FR 55232 (Section 301 exclusion extension); Gateway Tariff Radar

What not to do: undervalue the invoice

Some suppliers offer to put a lower value on the commercial invoice to cut your duty. Say no. Your company, as the importer, is the one exposed to the consequences:

• Civil penalties

  For negligence, up to twice the duty that went unpaid. For gross negligence, up to four times. For fraud, up to the full domestic value of the goods. You pay the missing duty either way (19 U.S.C. 1592).

• Criminal charges

  Entering goods with a false invoice or statement can bring fines and up to two years in prison, and the goods can be forfeited (18 U.S.C. 542).

• False Claims Act cases

  Knowingly avoiding money owed to the government can bring triple damages plus penalties (31 U.S.C. 3729). The Justice Department has filed these cases against importers accused of undervaluing goods with double invoices.

Found a mistake on past entries? Telling CBP through a prior disclosure before an investigation starts can reduce the penalties (19 U.S.C. 1592(c)(4)). Talk to a licensed customs broker or a trade attorney first.

Sources: 19 U.S.C. 1592 (civil penalties); 18 U.S.C. 542 (entry by false statements); 31 U.S.C. 3729 (False Claims Act); Justice Department: the Barco Uniforms complaint

Run your numbers, then plan the shipment

Questions importers ask

Sources

• 19 U.S.C. 1401a (transaction value)
• 19 CFR 152.103 (freight and inland charges)
• CBP Customs Rulings Online Search System (CROSS)
• 19 CFR Part 177 (binding rulings, including 177.1 and 177.9)
• Proclamation 11021, 91 FR 18201 (Federal Register)
• 19 U.S.C. 1401a(b)(3)
• CBP ruling H005222 (first sale, Nissho Iwai standard)
• CBP: About Foreign-Trade Zones
• 19 CFR Part 146 (foreign-trade zones)
• Proclamation 11021 (zone admission for metals)
• 19 U.S.C. 1313 (drawback)
• 19 CFR 190.3 (what drawback covers)
• 19 CFR 182.12 (USMCA certification of origin)
• CBP: USMCA
• 90 FR 55232 (Section 301 exclusion extension)
• Gateway Tariff Radar
• 19 U.S.C. 1592 (civil penalties)
• 18 U.S.C. 542 (entry by false statements)
• 31 U.S.C. 3729 (False Claims Act)
• Justice Department: the Barco Uniforms complaint

Estimates and guidance only. Verify with a licensed customs broker before entry. Gateway Lines is not a customs broker, and nothing on this page is classification or valuation advice for a specific entry.