KPMG article: How intellectual property payments impact U.S. tariffs on goods
Merchandise importers may owe significantly increased duties when the U.S. CBP determines that customs values include not only the value of the goods, but also related royalty and license fees.
When it comes to U.S. import duties, most importers recognize that tariffs are generally assessed against the imported merchandise’s dutiable customs value. However, what often goes unnoticed are the off-invoice payment (e.g., royalties and license fee, etc.) that can significantly increase the dutiable value and duties owed. In today’s elevated tariff environment, these costs can turn an ordinary import into major financial exposure. Should U.S. Customs and Border Protection (CBP) determine that a royalty or intellectual property-related fee is dutiable, the importer must add it to the customs value. Understanding how CBP treats these payments is essential for minimizing risk, maintaining compliance, and avoiding costly surprises.
Read a July 2025 article* prepared by KPMG LLP Trade & Customs professionals
* Reproduced with permission from Tax Management International Journal, 7/2/2025. Copyright @ 2025 by Bloomberg Industry Group, Inc. (800-372-1033) http://www.bloombergindustry.com