Merchandise Processing Fee Undergoing Review Due to TPP Requirements


The House Committee on Ways and Means and U.S. Customs have already began reviewing alternatives to revamp the collection of the Merchandise Processing Fee (MPF) in order to comply with the Trans-Pacific Partnership (TPP).  TPP rules prevent the MPF from being assessed on an ad-valorem basis.  Currently, the MPF rate is 0.3464% with a minimum of $25.00 and a maximum of $485.00 per entry.  Existing MPF exemptions for Free Trade Agreements and Preferential Programs, as well as those listed in the Customs Regulations at 19 CFR 24.23 (c) (1) would remain in place.

A multi-tiered collection of the MPF on formal entries for merchandise imported into the United States is under consideration, although this change can be implemented up to three years after the Agreement enters into force.  The following MPF schedule is under consideration:

$30 on entries valued between $2,501 and $20,000,

$120 on entries valued between $20,001 and $55,000,

$260 on entries valued between $55,001 and $130,000,

$500 ceiling on entries valued above $130,000.

Preliminary information reveals that 47 percent of importers will benefit by this fee structure by paying a lower MPF annually which would result in savings of approximately $760, while 53 percent of importers will pay higher fees, averaging an additional $119.

With the future of TPP covered by a political cloud at the present time, the question is whether or not these MPF changes will ever need to be implemented.