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More Details on Proposal to Restructure Merchandise Processing Fee

Tuesday, March 08, 2016
Sandler, Travis & Rosenberg Trade Report

Additional details have been made available on a proposed plan to restructure the merchandise processing fee in light of a provision in the Trans-Pacific Partnership that prohibits the MPF from being levied on an ad valorem basis. The MPF is currently assessed at 0.3464 percent of merchandise value for entries above $2,500, capped at $485 per entry.

Sources state that the proposal is intended to be revenue neutral, be easily administered and have minimal impact on importers. With these goals in mind, the proposal would apply to all formal entries of merchandise imported into the U.S. and  impose a minimum $30 MPF on entries valued between $2,501 and $20,000, which represents approximately 50 percent of formal entries filed in 2015. A $120 MPF would be imposed on entries valued from $20,001 to $55,000 and a $260 MPF would be imposed on entries valued from $55,001 to $130,000. The MPF for all entries valued at more than $130,000 would be capped at $500. 

Current exemptions from MPF assessment (e.g., under preference programs) would remain in place. MPF for informal entries valued between $200 and $2,500 and shipped to the U.S. via air, ship and international mail is imposed at a set fee of $2, $6 or $9 and will be unchanged. No MPF is assessed on entries below $200, though that amount will increase to $800 as of March 11 pursuant to the recently enacted customs reauthorization bill.

According to sources, 47 percent of importers would see a decrease in the amount of MPF they pay annually under this proposal, with an average decline of $760. The remaining 53 percent of importers would be expected to see an average increase of $119.

Input is still being gathered and the proposal could be revised before its anticipated inclusion in TPP implementing legislation that the White House hopes to submit for congressional approval later this year.

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