Senior Member from CA
joined:Nov 12, 2003
For the past seven years, we have been dropshipping, and our suppliers have been declaring our cost, instead of the cost to the customer on the invoice.
The packing slip inside the box has no prices, and the commercial invoice is buried inside the plastic shipping pouch. Customs never open the pouch, as they have all the details electronically in advance anyways.
I have never worried about it, since it was the dropshipper's signature on the customs documents, and we were talking about informal entries to consumers anyways.
We are now taking over the shipping ourselves, as we were offered a great deal we could not refuse; as they wanted to get out of the drop shipping business.
Now that my signature, (or one of my employees) will be on the customs form, I'm a little concern.
We would like to continue the practice, as we use section 321 to ship duty free to the USA for shipments under $200 US. By declaring the wholesale value we can increase this to let say $400
We have always guaranteed to our customers; that our shipments would be duty free to the usa, so we split ship orders that exceed the limits; and ship on alternate days.
In other words, US customs will never get duty, as we would split ship (which is perfectly legal). However the courier will make more money off two shipments rather than one.
I know that US customs would like us to declare the full retail selling price to the customer; but it appears that everybody is encouraging this practice of using wholesale value. I'm not even sure if it is illegal or a grey area.
I hear in China, that people are punnish with 100 lashes, if they declare full value by mistake on their export shipments :)
Maybe, I'm just a little paranoid about being worried about small consummer shipments; when US Customs has much bigger issues to worry about.
Anybody had any experience with this?