Before you place that order with your overseas supplier, you need to know exactly what you will owe when the goods arrive at US customs. Import tax is not a single charge — it is a combination of duty, tariffs, and fees that together can add 10-50% to your product cost. Get the calculation wrong and your profitable product becomes a money loser. Here is how to calculate it correctly.
The import tax formula
Total US import tax is the sum of these components:
Total Import Tax = Base Duty + Section 301 Tariff + MPF + HMF
Where:
Base Duty = Customs Value × Duty Rate (from HTS)
Section 301 = Customs Value × 301 Rate (China-origin goods only)
MPF = Customs Value × 0.3464% (min $31.67, max $614.35)
HMF = Customs Value × 0.125% (ocean shipments only)
Let us break down each component.
Step 1: Determine your customs value
The customs value is the base number that all duties and fees are calculated on. For most imports, it equals the transaction value — what you actually paid for the goods, adjusted for certain additions.
What is included in customs value:
- Price paid for the goods (invoice amount)
- International shipping cost (to the US port of entry)
- Insurance cost
- Packing costs
- Assists — tooling, molds, dies, or materials you provided to the manufacturer
- Royalties or license fees related to the goods
- Proceeds of resale that go back to the seller
What is NOT included:
- US domestic shipping (port to your warehouse)
- Import duties themselves
- Post-importation assembly or installation
- International shipping costs for goods shipped on a "delivered" basis where the buyer arranges transport (in some cases)
Example:
You buy 1,000 units at $5 each ($5,000 FOB). Ocean freight is $1,200. Insurance is $80.
Customs value = $5,000 + $1,200 + $80 = $6,280
Step 2: Find your duty rate (HS code classification)
Every product has an HS code (Harmonized System code) that determines its duty rate. The US uses the Harmonized Tariff Schedule (HTS) — a 10-digit code system.
To find your duty rate:
- Identify your product's HS code (use the first 6 digits internationally, 10 digits for US-specific rates)
- Look up the code in the HTS (available at hts.usitc.gov)
- Find the "General" duty rate in the "Rates of Duty" column
Duty rate types:
| Type | Format | Example | Meaning |
|---|
| Ad valorem | Percentage | 5% | 5% of customs value |
| Specific | Per unit | $0.15/kg | $0.15 per kilogram |
| Compound | Both | 3% + $0.10/kg | Percentage plus per-unit charge |
| Free | 0% | Free | No duty owed |
Most consumer goods have ad valorem (percentage) rates ranging from 0% to 25%. Some agricultural and textile products have specific or compound rates.
Step 3: Check for Section 301 tariffs
If your goods originate in China, you likely owe additional Section 301 tariffs on top of the base duty rate. These were imposed starting in 2018 and expanded through 2025-2026.
Current Section 301 rates (2026):
| List | Rate | Products covered |
|---|
| List 1 | 25% | Industrial machinery, electronics components |
| List 2 | 25% | Chemicals, plastics, metals |
| List 3 | 25% | Consumer goods, furniture, textiles (raised from 10% to 25%) |
| List 4A | 7.5% | Remaining goods not on Lists 1-3 |
| Special increases | 50-100% | EVs, batteries, solar cells, semiconductors, steel/aluminum, medical supplies |
Important: Section 301 tariffs are based on country of ORIGIN, not country of shipment. Goods manufactured in China but shipped from Vietnam still owe Section 301 tariffs.
Step 4: Calculate Merchandise Processing Fee (MPF)
The MPF applies to all formal entries (goods valued over $2,500 or requiring formal entry for other reasons).
- Rate: 0.3464% of customs value
- Minimum: $31.67 per entry
- Maximum: $614.35 per entry
The maximum cap means MPF becomes proportionally smaller for large shipments. On a $200,000 shipment, MPF is only 0.31% ($614.35 ÷ $200,000).
Step 5: Calculate Harbor Maintenance Fee (HMF)
HMF applies only to goods arriving by ocean vessel (not air freight or land border).
- Rate: 0.125% of customs value
- No minimum or maximum
HMF funds port infrastructure maintenance. It is a small charge but adds up on large ocean shipments.
Complete calculation examples
Example 1: Bluetooth speakers from China
Product: 500 Bluetooth speakers, HS code 8518.22.00
- Invoice value: $10,000 (FOB Shenzhen)
- Ocean freight: $800
- Insurance: $120
- Customs value: $10,000 + $800 + $120 = $10,920
Duty calculation:
| Component | Rate | Calculation | Amount |
|---|
| Base duty | Free (0%) | $10,920 × 0% | $0.00 |
| Section 301 (List 1) | 25% | $10,920 × 25% | $2,730.00 |
| MPF | 0.3464% | $10,920 × 0.3464% | $37.83 |
| HMF | 0.125% | $10,920 × 0.125% | $13.65 |
| Total import tax | $2,781.48 |
Effective tax rate: 25.5% of customs value
Note: The base duty is 0% (free), but Section 301 adds 25%. Many importers see "Free" in the HTS and assume no duty — then get hit with a $2,730 bill.
Example 2: Yoga mats from Vietnam
Product: 200 yoga mats, HS code 9506.91.00
- Invoice value: $4,000 (FOB Ho Chi Minh City)
- Ocean freight: $600
- Insurance: $50
- Customs value: $4,000 + $600 + $50 = $4,650
Duty calculation:
| Component | Rate | Calculation | Amount |
|---|
| Base duty | 4% | $4,650 × 4% | $186.00 |
| Section 301 | N/A | Vietnam origin — not subject | $0.00 |
| MPF | 0.3464% | $4,650 × 0.3464% | $31.67 (minimum) |
| HMF | 0.125% | $4,650 × 0.125% | $5.81 |
| Total import tax | $223.48 |
Effective tax rate: 4.8% of customs value
Vietnam-origin goods avoid Section 301 tariffs entirely. This is why many importers are shifting sourcing from China to Vietnam — the duty difference can be 20+ percentage points.
Example 3: Furniture from China (high-value)
Product: 50 office desks, HS code 9403.30.80
- Invoice value: $25,000 (FOB Ningbo)
- Ocean freight: $3,200
- Insurance: $300
- Customs value: $25,000 + $3,200 + $300 = $28,500
Duty calculation:
| Component | Rate | Calculation | Amount |
|---|
| Base duty | Free (0%) | $28,500 × 0% | $0.00 |
| Section 301 (List 3) | 25% | $28,500 × 25% | $7,125.00 |
| MPF | 0.3464% | $28,500 × 0.3464% | $98.72 |
| HMF | 0.125% | $28,500 × 0.125% | $35.63 |
| Total import tax | $7,259.35 |
Effective tax rate: 25.5% of customs value
On a $25,000 order, you owe over $7,000 in import taxes. This must be factored into your product pricing or your margins evaporate.
Example 4: Air-shipped electronics from Taiwan
Product: 100 circuit boards, HS code 8534.00.00
- Invoice value: $8,000 (CIF Los Angeles — shipping already included)
- Customs value: $8,000 (CIF price is the customs value)
Duty calculation:
| Component | Rate | Calculation | Amount |
|---|
| Base duty | Free (0%) | $8,000 × 0% | $0.00 |
| Section 301 | N/A | Taiwan origin — not subject | $0.00 |
| MPF | 0.3464% | $8,000 × 0.3464% | $31.67 (minimum) |
| HMF | N/A | Air shipment — no HMF | $0.00 |
| Total import tax | $31.67 |
Effective tax rate: 0.4% of customs value
Duty-free product from a non-301 country shipped by air = almost zero import tax. Only the minimum MPF applies.
Special duty programs that reduce your tax
De minimis (Section 321)
Shipments valued at USD 800 or less enter duty-free with no formal entry required. Restrictions apply for China-origin goods subject to Section 301. See our Section 321 guide.
USMCA (US-Mexico-Canada Agreement)
Goods manufactured in Mexico or Canada may qualify for 0% duty under USMCA if they meet rules of origin requirements. You must have a USMCA certificate of origin.
Generalized System of Preferences (GSP)
Reduced or zero duties on eligible products from designated developing countries. Note: GSP has expired and been renewed multiple times — check current status before relying on it.
Foreign Trade Zones (FTZ)
Goods stored in an FTZ can defer duty payment until they enter US commerce. Useful for inventory that may be re-exported or for choosing the most favorable duty rate (component vs. finished product).
Temporary importation under bond (TIB)
Goods imported temporarily (for exhibition, testing, repair) can enter duty-free under bond, provided they are exported within one year.
Common calculation mistakes
1. Forgetting Section 301 tariffs
The HTS shows a base rate of "Free" or "3.5%" — but Section 301 adds 7.5-25% on top for China-origin goods. Always check both the base rate AND Section 301 applicability.
2. Using FOB value instead of CIF
US customs calculates duty on CIF value (including shipping and insurance to the US port). If you use only the FOB price, you underestimate your duty by the shipping cost percentage.
3. Wrong HS code classification
A product classified under the wrong HS code can have a dramatically different duty rate. A "plastic container" might be 3.4% under one code or 12.5% under another. Get classification right — it is the single biggest factor in your duty bill. Read our HS code lookup guide.
4. Ignoring assists
If you provided molds, tooling, designs, or materials to your manufacturer, their value must be added to the customs value. A $5,000 mold amortized over 10,000 units adds $0.50 per unit to your customs value.
5. Not accounting for MPF minimum
On small formal entries (just over $2,500), the MPF minimum of $31.67 is proportionally significant. On a $3,000 shipment, MPF is 1.06% — not 0.35%.
6. Assuming all China goods have the same 301 rate
Section 301 rates vary by list: 25% (Lists 1-3), 7.5% (List 4A), or higher for specific sectors (EVs, batteries, etc.). Check which list your product falls under.
How to estimate before you order
Before committing to a purchase order, estimate your total import cost:
- Find your HS code — ask your supplier or use our HS code guide
- Look up the duty rate — check hts.usitc.gov for the General rate
- Check Section 301 — if China origin, determine which list applies
- Calculate customs value — product cost + shipping + insurance
- Apply the formula — (customs value × total duty rate) + MPF + HMF
- Add to your landed cost — use our landed cost guide for the complete picture
Or use our Import Duty Calculator to get an instant estimate.
When to get professional help
Calculate duties yourself for straightforward imports. Get a licensed customs broker involved when:
- Your product could be classified under multiple HS codes with different rates
- You are importing regulated goods (FDA, USDA, EPA, FCC)
- You want a binding ruling from CBP on classification
- Your shipment involves assists, royalties, or complex valuation
- You are importing under a trade agreement and need to verify rules of origin
- The duty amount is large enough that a classification error would be costly
Key takeaways
- Import tax = Base Duty + Section 301 + MPF + HMF — calculate all four
- Customs value includes shipping and insurance (CIF), not just product cost (FOB)
- Section 301 tariffs add 7.5-25%+ for China-origin goods — this is often the largest component
- MPF has a minimum ($31.67) and maximum ($614.35) — it caps on large shipments
- HMF (0.125%) applies only to ocean shipments
- Wrong HS code = wrong duty rate — get classification right
- Always calculate total import tax before placing an order to protect your margins