Save Duty on Year-End Entries

November 2001

As in past years, we expect the Customs Service to issue a blanket authorization allowing the use of "immediate delivery" procedures for most kinds of merchandise released on or after December 17, 2001 and until December 31, 2001. This authorization allows filers the opportunity to take advantage of reduced tariff rates or special tariff programs that take effect on or after January 1, 2002.

How does this work? When calculating duties, Customs uses the tariff rates in effect at the "time of entry." In those situations where the Customs Form 3461 is used as the entry, the "time of entry" is when the merchandise is released by Customs. Under the immediate delivery procedure, however, Customs uses the time of entry as the date that the entry summary is filed with estimated duties, which must be submitted within ten working days after release. Thus, with the immediate delivery procedure, merchandise released within ten working days of a new year can be considered made in the new year. If the applicable duty rate in the new year is less than in the year of release, then the importer benefits.

How do you qualify? In those situations where the Customs Form 3461 is used as the entry, a line must be drawn through the word "entry" on the form, leaving only the words "immediate delivery." Filers must then insert a January 2002 date. If filing paperless entries, then the filer can simply designate the chosen January 2002 date in the "estimated entry date" field on the ABI summary transmission. If the filer fails to designate a January 2002 date, then the 2001 rates will apply.

Do all entries qualify for year-end "immediate delivery" status? No. Merchandise imported under an absolute quota cannot take advantage of immediate delivery procedure. This would include textiles and wearing apparel imported under absolute quotas. Also, merchandise moved under immediate transportation cannot take advantage of it.

Can you use the immediate delivery procedures year round? It depends. The Customs Regulations (19 CFR § 142.21) spell out a limited number of situations where an importer can use immediate delivery. Merchandise arriving by land from either Canada or Mexico, entries of fresh fruits or vegetables, shipments to U.S. agencies or articles used in trade fairs are some of the types of merchandise that can use the immediate delivery procedure year round.