Prepare for Increased MPF

The proposed increase in the Merchandise Processing Fee “MPF” from .21% to .3464% cleared another hurdle as it passed in the House and is on its way to the Senate.    

Why should you care about an increase?

The Merchandise Processing Fee is authorized under 19 U.S.C. 58c, and is used to offset the costs of processing merchandise entering the United States. Imported merchandise formally entered or withdrawn from a warehouse for consumption, is currently subject to payment to CBP of an “ad valorem” fee of 0.21% of the total value for the shipment.  The minimum fee is $25 and the maximum fee is $485 on formal entries.  Informal entries, those generally valued under $2,000, are subject to a flat $2 MPF if the entry of the shipment is automated. 

Check out the chart for a comparison of MPF calculation comparisons using the current MPF and the proposed MPF. Assume that the calculations are based on imports from a country not subject to reduced MPF rates resulting from a free trade agreement.  How will this affect the amount of fees you pay on entries?  Assuming that the $485 cap remains the same, the increase will not have much impact on high value importers.  You may want to review the average entered value of shipments to determine how much this change impacts your bottom line.  Although it would be extremely unpopular with importers, the government could have collected more money if they considered an increase to the maximum MPF payable of $485 per entry.

Value	Current MPF 0.21%	MPF Due	Proposed MPF 0.3464%	MPF Due	Increase
$       500	$2 Informal	$2	$2 Informal	$2	None
$    5,000	$5,000 x .21% = $10.50	$25	$5,000 x .3464% = $17.32	$25	None
$  15,000	$15,000 x .21% = $31.50	$31.50	$15,000 x .3464% = $51.96	$51.96	$20.46
$  50,000	$50,000 x .21% = $105	$105	$50,000 x .3464% =$173.20	$173.20	$68.20
$100,000	$100,000 x .21% = $210	$210	$100,000 x .3464% = $346.40	$346.40	$136.40
$250,000	$250,000 x .21% = $525	$485	$250,000 x .3464% = $866	$485	None

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