Duty Elimination

With Stalco’s Duty Elimination Program, B2C sellers can eliminate 100% of their duty costs

By shipping your inventory directly from China to Stalco’s Toronto based distribution facility and then having Stalco pick n’ pack & ship your consumer orders daily, you can eliminate 100% of your duty costs without sacrificing delivery time or costs.

The key to the success of the program is Section 321 Customs Clearance which allows US consumers to import up to $800 worth of goods tax and duty free.  With Stalco’s same-day fulfillment process and its proximity to the USA border (only 1.5 hours away) Stalco sends trucks to the USA on a daily basis, clearing US customs under Section 321 and then inducting packages with all the major US carriers like USPS, DHL, UPS & FedEX.   This gives clients the same delivery services, costs, and transit times as a USA based fulfilment company with the added benefit of eliminating 100% of the duty cost!

The genesis of how you can eliminate your duty costs dates back to changes made to the De Minimis in February 2016.

De Minimis value threshold is the maximum dollar value of a shipment that can be imported into a country duty and tax free. In February of 2016 the US raised the de minimis value from $200-$800. At $800 the amount became aligned with the amount US citizens could bring back whenever travelling by plan back into the USA. The new de minimis value was published by CBP (Customs and Border Protection) in August 2016 as part of an issuance of section 321 exemptions.

Benefits of Section 321

The main and obvious benefit is that under Section 321 Clearance certain shipments are exempt from duties and taxes. In order to qualify for the exemption shipments must be imported by an individual US consumer on a single day and have the retail value of the product must be $800 or lower.

Prior to the $600 increase in the De Minimis rules in February 2016, the old Section 321 rules existed however the maximum retail threshold for Section 321 was limited to products equal to or below $200. With the enormous growth of online shopping combined with the increase de minimis of $800, the number of shipments entering the USA under section 321 clearance has increased exponentially. In fact, data from Customs and Border Protection (CBP) confirms that every day nearly 2 million shipments are released into the US under Section 321.

With the incredible increase in shipments entering the USA under Section 321, to ensure the smooth flow of cross border shipments, it is imperative that Customs and Border Protection receive all the Section 321 shipment details prior to the shipments arrival at the border so that it can maintain expedited customs clearance demanded by the private sector in addition to any necessary enforcement measures for non-compliance. To assist with this process a Section 321 Data Pilot Program was initiated. The intent behind the program was to test the viability of allowing shippers to submit all of the required documentation electronically prior to the shipment’s arrival at the border.

With the incredible fast paced nature of the e-commerce world, it is critical that government agencies scope out the most efficient methodology to allow for the smooth flow of goods across the border while at the same time strict adherence to the rules.

Under the current section 321 rules CBP is requiring that companies submit information in advance of the shipment’s actual arrival at the border. This is necessary in order to be able to identify high-risk products and ensure they comply with US safety and security requirements.

The Section 321 rules for importation apply regardless of the type of transportation into the United States. With Section 321 clearance into the United States, it is critical that carriers identify the shipper name and address, a description of the type of goods, weight, quantity and the consignees name and address.