April 2024, question 76

A shipment of portable gas stoves manufactured in Sweden are imported into the United States. The appraised value of each stove upon importation is $600.00. They are classified under 7321.11.1030 with a duty rate of 5.7 percent. The importer discovers that 15 of the stoves have a faulty gas valve. The stoves are exported to Canada for warranty repair. Upon reimportation from Canada, there is no charge to the importer, but the value of the repair is $120.00 each. The reimportation is under 9802.00.40 in the Harmonized Tariff Schedule of the United States. Which statement accurately reflects the dutiable value and duty rate upon reimportation?

1. The dutiable value is $1,800.00, and the duty rate is "Free" with a claim of "S" as the goods were repaired in Canada and the United States-Mexico-Canada Agreement applies to repairs of goods originating outside of the United States, Mexico, or Canada.
2. The dutiable value is $1,800.00, and the duty rate is 5.7%, the rate of duty on the article itself, as goods originating outside of the United States, Canada, or Mexico are not eligible for duty free treatment under the United States-Mexico-Canada Agreement.
3. The dutiable value is $0.00 because the importer was not charged for the repair, and the rate of duty is not relevant since any rate of duty multiplied by a dutiable value of $0.00 will be $0.00 owed.
4. The dutiable value is $0.00 because the importer was not charged for the warranty repair, and the duty rate is 5.7 percent because it is the duty rate that applies to the article itself.

Question and key from CBP's April 2024 exam and answer key. The walk-through is ours; quotes are from the pinned editions in the reference viewer (HTSUS 2026 Basic, 19 CFR 2025 edition).