CBP Announces 90 Day Postponement for SOME Duties/Taxes

The ever changing COVID-19 environment brought yet another dramatic announcement from CBP/US Customs. WSSA and other associations has been pressuring the US Government for parity for importers with domestic producers on postponement of Federal Excise Taxes. While this is not exactly what has happened, CBP/US Customs and Border Protection sent out to CSMS (Customs Service Messages) on Sunday evening April 19 in regards to a 90 day postponement of "certain" estimated duties, taxes and fees for importers experiencing significant financial hardship due to the COVID-19 crisis (CSMS #4243171, link here).

A second message was issued soon after (CSMS #4241561 link here) outlining the payment methodology for postponing duty and tax deposits.

There are a few key items in this announcement that must be noted:

Significant financial hardship:

To be considered under significant financial hardship, an importer must demonstrate that the operations of the importing company were fully or partially suspended during March 2020 or April 2020 due to various orders from a government authority limiting the importers capacity to function.  If, as a result of limitations, the gross receipts of the importer from March 13-31 or April 2020 are less than 60 percent of the gross receipts from the same period in 2019, the importer would be eligible to qualify for postponement. If eligible, the importer does not need to file documentation with CBP, but must retain records establishing that the company meets the requirements and CBP may review the documentation at any given time to insure compliance.

Entries NOT eligible for postponement:

The announcement included information that excludes certain types of entries, including those subject to Section 20, 232, or 301 duties, which will EXCLUDE any entries subject to the current retaliatory tariffs on certain EU products due to the WTO Airbus case. If you qualify for the postponement AND you have shipments that may include entries subject to the EU tariffs that also contain items NOT subject to the EU tariffs, you must file two separate entries to allow postponement on the portion of the shipment that is not hit with the retaliatory tariffs.

Payments:

The details of scheduling payments to CBP are outlined in the CSMS messages and your customs broker will work with you to adjust the payments according to the authorization. For any of you not currently utilizing direct ACH payments to CBP, this would be an excellent time to consider ACH to insure the adjustments and timely payments take place and monitoring from your own bank account. 

We understand that this can be confusing and we will be publishing more details as they roll out.  We have a scheduled call later today with various associations to review and analyze the process and details of this new announcement and will provide further updates.