Customs and excise bonds act as a financial safety net for importers facing sudden tariff spikes. These bonds allow importers to clear shipments immediately while deferring duty or excise payments, helping maintain cash flow, prevent port delays, and stay compliant with CBP, IRS, and TTB requirements.
Tariff changes are now a constant reality for United States importers, from Section 301’s Chinese goods duties to Section 232’s steel and aluminum tariffs. When rates spike, importers can face sudden cash flow strains and struggle to afford rising duties, leading to shipment delays and other operational disruptions.
U.S. customs and excise bonds provide a financial bridge during these situations, enabling importers to clear their goods through customs while temporarily deferring their duties, taxes, and excise obligations.
Below, we’ll explore how customs and excise bonds work, how they help during tariff volatility, and how BOSS Bonds can support importers with our nationwide network of surety carriers.
U.S. customs and excise bonds guarantee that importers, manufacturers, and distributors will comply with federal law and pay their duties and taxes. Here’s a closer look at each of these surety bonds:
The U.S. Customs and Border Protection (CBP) requires customs bonds for commercial imports that are valued over $2,500 or subject to federal oversight. These bonds serve as a financial guarantee that importers will pay all applicable duties, taxes, and fees associated with their shipment once it enters the country.
Customs bonds come in two forms:
Importers who process more than four or five shipments per year typically choose continuous bonds, as they offer greater flexibility and reduce repetitive paperwork.
All customs bonds must be filed electronically using CBP’s Automated Commercial Environment (ACE) system, which is the main portal for U.S. import and export processing.
Excise bonds are required by the Internal Revenue Service (IRS) and the Alcohol and Tobacco Tax and Trade Bureau (TTB) for businesses that manufacture, import, store, or distribute products subject to federal excise taxes. These taxes apply to a wide range of regulated goods, including:
Excise taxes help regulate the production and distribution of these goods and generate government revenue. Meanwhile, excise bonds ensure the government receives these tax payments, even if a business can’t pay them on time.
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If you’re an importer, securing the appropriate customs and excise bonds does more than just satisfy your regulatory requirements. Customs bonds, in particular, can offer powerful liquidity benefits.
Typically, you must pay duties upfront, often upon entry or shortly after. But with a customs bond, you can defer payments by 10 to 45 days instead and still import your goods right away. This breathing room can be invaluable in the face of sudden tariff spikes, giving you the time you need to adjust your budget or negotiate contracts behind the scenes.
Consider a roofing company that imports $250,000 in engineered wood from Asia every quarter. After a new tariff raises its duty rates by 25%, the business suddenly owes an extra $62,500 at the border.
Thanks to their continuous customs bond, this importer’s shipment clears immediately and gives them time to adjust their pricing, renegotiate their supplier terms, and update their proposals to afford their elevated tariff obligations.
If you want to enhance your liquidity and strengthen your compliance, working with a reliable surety agency is essential. At BOSS Bonds, we can clarify your bonding requirements and match you with the best surety carrier for your unique situation.
If you opt for a continuous customs bond, you’ll typically need to purchase one with a minimum amount of $50,000 or 10% of the duties, taxes, and fees you’ve paid over the last 12 months—whichever is greater.
Calculating the right bond amount can be complicated, especially when tariffs rise without warning. If duty spikes render your current bond insufficient, the CBP may suspend your shipping privileges, resulting in:
Working with the right surety provider can prevent these issues. For example, at BOSS Bonds, we partner with several Treasury-listed surety companies that can monitor your bond sufficiency year-round, issue bond increase alerts, and facilitate a smooth re-bonding process.
Did You Know?
If CBP flags your bond as insufficient, it can suspend your entry privileges until you file a new bond. Working closely with your surety can help you stay ahead of these compliance risks.
To clarify the importance of customs bonds, let’s take a look at an example: An auto parts importer has a $100,000 continuous customs bond. After Section 232’s 15% steel tariff hike, their annual duties triple overnight, causing their existing bond amount to fall short of CBP requirements.
The CBP flags their bond and issues an urgent demand to increase its amount. Without prompt action, their goods will be held at the port until they make the required adjustments.
Luckily, this importer works with a supportive surety company. Within hours, the importer secures the updated bond rider, clears their shipment, and avoids weeks of costly delays.
Along with customs and excise bonds, you may also benefit from the following trade programs and bond types:
Like CBP customs and excise bonds, these bonds help protect your cash flow in a quickly evolving trade climate.
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As you navigate today’s fluctuating tariffs, customs and excise bonds can protect your liquidity from uncertainty. To summarize, these bonds allow you to:
Whether you import consumer goods or distribute excisable products, you need a bond provider you can count on. As a surety-only agency with a nationwide network of carriers, BOSS Bonds can help you secure the bonds you need quickly.
We stand out for our fast bond quotes and approvals, access to top-tier, Treasury-listed carriers, and attentive support. Contact BOSS Bonds today to learn how we can strengthen your cash flow and compliance!
United States Trade Representation. China Section 301-Tariff Actions and Exclusion Process.
https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions
U.S. Customs and Border Protection. Section 232 Tariffs on Steel and Aluminum Frequently Asked Questions.
https://www.cbp.gov/trade/programs-administration/entry-summary/232-tariffs-aluminum-and-steel-faqs
U.S. Customs and Border Protection. When is a Customs bond required.
https://www.help.cbp.gov/s/article/Article-1214?language=en_US
U.S. Customs and Border Protection. ACE and Automated Systems.
https://www.cbp.gov/trade/automated
U.S. Customs and Border Protection. Bonds - How to obtain a Customs Bond.
https://www.helpspanish.cbp.gov/s/article/Article1072?language=en_US
U.S. Customs and Border Protection. Temporary Importation under Bond (TIB).
International Trade Administration. U.S. Foreign-Trade Zones.