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October 2026, question 73
Valuation, Appraisement and Duty Assessment · Valuation
A U.S. Importer pays $8,953.00 to Brush Factory for a shipment of brooms and mops. The $8,953.00 payment consists of $5,498.00 for the product and $3,455.00 for ocean freight and insurance. Brush Factory would have charged a total of $15,860.00 for the shipment, including the ocean freight and insurance; however, Brush Factory billed a lesser amount because it was indebted to the importer from a past transaction. Based on the facts above, what is the transaction value of the shipment of brooms and mops?
- $5,498.00
- $8,953.00
- $12,405.00
- $15,860.00
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CBP's answer: C. C: $12,405.00
A price reduction the buyer receives on a current importation to settle a debt the seller owes is an indirect payment, so the price actually paid or payable includes it (152.103(a)(2)). The importer paid $8,953 but the seller would have charged $15,860, and $3,455 of that is ocean freight and insurance, which are excluded from the price actually paid or payable (152.102(f)). The transaction value is $15,860 less $3,455, or $12,405, so C is right.
where the buyer receives a price reduction on a current importation as a means of settling a debt owed him by the seller 19 CFR 152.103(a)(2)
exclusive of any charges, costs, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise 19 CFR 152.102(f)
Search for: price reduction on a current importation as a means of settling a debt
CBP's key cites: 19 CFR 152.103(a)(2)
Question and key from CBP's October 2026 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).