October 2022 — Question 24

Upon auditing an entry, the importer of record (IOR) discovered that the total entered value was incorrect. The correct entered value was $5,718.00 more than shown on the entry documentation, resulting in additional duty in the amount of $187.25 and additional MPF in the amount of $19.81. The IOR requested that its broker file an accelerated liquidation PSC and advised that it would pay the bill for the underpayment upon receipt. There are 120 days between when the duties, taxes and fees are due and the liquidation of the entry, so that, if interest is due, the interest on the additional duties would be $1.89 and the interest on the merchandise processing fee (MPF) would be $0.20. How much will the bill for the underpayment be?

• AThe bill will be for the $187.25 in additional duty because the MPF is under $20.00 and the interest on both the additional duty and the MPF is under $20.00, so the de minimus rule applies to both the MPF and the interest.
• BThe bill will be for $189.14 in additional duty plus interest and not the MPF because the de minimus rule applies to the additional MPF because the MPF is less than $20.00.
• CThe bill will be for $207.06, the additional duty plus the additional MPF, because CBP does not charge interest on underpayments where the liquidation takes place 180 days or less after the duty due date.
• DThe bill will be for $208.95, the duty plus interest and the MPF, because CBP does not charge interest on the underpayment of fees but does charge interest on the underpayment of duties.
• EThe bill will be for $209.15 which is the duty of $187.25 plus interest on the duty in the amount of $1.89 added to the additional MPF of $19.81 plus interest of $0.20 because the net difference in duties, taxes, fees, and interest is greater than $20.00.✓ CBP's answer