CBP rakes in record $72 billion in duties for fiscal year 2019

U.S. Customs and Border Protection (CBP) said it collected $71.9 billion in import duties during fiscal year 2019, a 73% increase over the previous fiscal year. 

When additional fees and taxes were included, the agency took in a total $80.7 billion for the fiscal year. 

CBP announced the record duty collections on Thursday, when it publicly released its CBP Trade and Travel Report: Fiscal Year 2019.

“Much of the increase in duty collections in FY2019 is attributed to the ongoing assessment and collection of duties on steel, aluminum, washing machines, washing machine parts, solar panels, and goods from China,” the agency said in the report.

CBP noted that these duties, as well as quotas on steel and aluminum, were first ordered by President Trump during fiscal year 2018 after the administration concluded Section 232 and 301 trade investigations.

Specifically, CBP assessed about $716 million in Section 201 duties on items such as washing machines and solar panels, more than $1.1 billion in Section 232 aluminum duties and about $4 billion in Section 232 steel duties during fiscal year 2019. For Section 301 imports from China, the agency said it collected over $29 billion in duties during the fiscal period.

CBP also began enforcing 33 additional antidumping and countervailing duty orders during fiscal year 2019 for a total of 503 orders in effect. The agency recovered more than $121.8 million in antidumping and countervailing duty duties, an 86% increase over revenue recovered in fiscal year 2018.

Overall, CBP said it processed $2.7 trillion in imports during fiscal year 2019, equating to 35.5 million entries and more than 28.7 million cargo containers arriving at U.S. ports of entry.

Source: CBP Trade and Travel Report–Fiscal Year 2019

The agency attributed its ability to efficiently manage increasing volumes of imports to enhancements in its Automated Commercial Environment (ACE) and investments in nonintrusive inspection technologies.

“ACE’s automation and process simplification efforts resulted in an estimated economic benefit of approximately $537 million for the trade community and $106 million for CBP in FY2019, an increase of 38 percent in savings for the trade community and 200 percent in savings for CBP since FY2018,” the report said. “Similarly, the ACE system reduced processing times by 690,000 hours for the trade community and 1,896,000 hours for CBP.”

CBP said its nonintrusive inspection equipment allows the agency to scan an ocean container for contraband in eight minutes, compared to physical inspections which take an average of two hours per container. The agency estimated that the equipment saves it $1 billion in annual operating costs, while the import industry saves between $5.8 billion and $17.5 billion due to reduced cargo inspection delays.

During fiscal year 2019, CBP officers used 320 large, nonintrusive inspection systems at land and sea ports of entry to conduct about 6.6 million exams, which resulted in 3,016 seizures of illegal goods, such as narcotics, U.S. currency and weapons, for a 21% increase in seizures over the previous fiscal period.

The agency, however, continued to experience challenges with oversight of increasing volumes of low-value, small package e-commerce imports arriving by express carrier or international mail, which may conceal narcotics and counterfeit products.

CBP estimated that it now processes more than 600 million express packages and international mail shipments annually, or about 1.8 million per day. More than 90% of counterfeit goods seizures were found in express and international shipments, the agency said.

Last year, CBP initiated a pilot with nine companies to “test the utility of accepting advance data from e-commerce supply chain partners, including online marketplaces, to help identify the entity causing the shipment to move, the final recipient, and the contents of the package.” The agency expects to increase the number of industry participants in the two-year pilot this year.

In addition, CBP completed its first significant update to the Customs Trade Partnership Against Terrorism (CTPAT) minimum security criteria, since the voluntary public-private sector program was launched in November 2001.

The agency said CTPAT allows its officers to focus more attention on high-risk cargoes, rather than those shipments handled by its 11,600 certified program participants. CBP estimates that CTPAT participants saved $70.2 million in inspection costs during fiscal year 2019. CTPAT participants that signed onto CBP’s Advanced Qualified Unlading Approval (AQUA) Lane pilot also saved about $99 million in fiscal year 2019 through faster customs clearance of their container imports.

“CBP’s mission — securing the nation’s borders while facilitating lawful trade and travel — is critical for economic security and prosperity,” Brenda Smith, executive assistant commissioner for CBP’s Office of Trade, told reporters during a press conference at the agency’s Washington headquarters on Wednesday.

Smith said the agency enforces about 500 U.S. trade laws and regulations on behalf of 49 government agencies. The agency remains the second largest source of revenue for the U.S. government behind income taxes.