Everything you need to know about exporting from Indonesia to the US

The United States (US) is the world’s largest economy and among some of the biggest importers of goods. According to recent statistics by the Bureau of Economic Analysis (BEA), the US imported US$850.4 billion worth of goods in the second quarter of 2022. This makes the US the perfect market to trade with.

In 2021, Indonesian exports amounted to US$228.2 billion, based on numbers by the World’s Top Exports. Exports to the US made up 11.2% of this value, making the country the second best trading partner after China. What’s better? Indonesia enjoys its highest trade surplus with the US at US$14.4 billion. 

Reports by the Observatory of Economic Complexity revealed that the major Indonesian exports to the US include:

• Crustaceans (US$1.01 billion)
• Processed crustaceans (US$747 million)
• Furniture and related goods (US$700 million)

These statistics further cement how important the US market is for Indonesian businesses looking for significant global expansion. However, to export from Indonesia to the US, businesses must follow certain procedures for customs clearance. This involves preparing the right documents and paying customs duties and import taxes once the goods arrive in the US. 

In this article, we will share more about the import and export requirements and guidelines in Indonesia, as well as details about US customs such as taxes, duties and clearance.

1. Export requirements

Export licences

Export licences are required by local businesses before they can ship their goods overseas, including the US. These include Tax Payer Identification Number (NPWP) and the Business Identification Number (NIB) and other documents required by the regulations. If you are exporting restricted goods, you may also require a Registered Exporter (ET), export permits (SPE), Surveyor’s Report (LS), Certificate of Origin (COO) and other documents specified by the regulations. These are issued by the Ministry of Trade.

Documentation

Before exporting from Indonesia to the US, businesses must comply with the documentation requirements. These include:

• Commercial invoice
• Company Registration Certificate
• Bill of Lading, Airway Bill or equivalent transport documents
• Customs Export Declaration
• Export Declaration of Goods (PEB)
• Insurance Certificate
• Export Permits & Licences
• Business Licence
• Certificate of Origin
• Packing List

2. Customs clearance in the United States

The US Customs and Border Protection (CBP) is a federal law enforcement organisation responsible for ensuring compliance with international trade laws. The agency specifies certain requirements that must be met by all overseas exporters and local importers before their goods can be cleared for entry by the US Customs authorities.

Regardless of whether you are exporting from Indonesia or other countries, you must follow the procedures listed below:

Import licences and permits

Although CBP does not require an import licence or permit, other agencies may make it mandatory depending on the type of goods entering the country. Hence, all necessary import licences, permits, or certifications must be applied for and obtained to avoid any issues at the border.

Entry documents

The importer must prepare the necessary documents for customs clearance within 15 calendar days from the date the goods arrived in the US. These include: 

• Entry Manifest (CBP Form 7533) / Application and Special Permit for Immediate Delivery (CBP Form 3461) / Other documents that allow port directors to release the goods
• Permit or evidence of right bring goods into the country
• Commercial or pro forma invoice (should the former cannot be produced)
• Packing lists (where applicable)

In addition, all customs duties and taxes must be paid within 10 working days of the goods entering the US. So what are the duty requirements when exporting from Indonesia to the US?

3. Customs duties and taxes in the United States

According to US import regulations, products worth below US$800 – referred to as the de minimis rate – are not subject to import duties. Products worth more than this will be pegged to customs tariff, depending on the type of goods in question. The average duty is 3.5% which is one of the lowest in the world. In addition, the trade-weighted tariff rate (excluding agricultural products) is 4.2%. 

Dairy products, beverages, tobacco, clothing, and sugars and confectionery are subject to higher tariffs.

The US applies the Harmonised System (HS) codes for classifying and calculating tariffs. Depending on the origin of products, customs duties and tariffs may vary. Duties and taxes are calculated ad valorem based on the Cost, Insurance and Freight value.

It’s also important to note that the CBP may require you to pay additional taxes and fees on behalf of other federal agencies. Some of these taxes and fees include the Federal Excise Tax, which is applied to alcoholic beverages and tobacco imports. The Merchandise Processing Fee (MPF) of 0.3465% will apply for goods worth over US$2,500, capped at a minimum US$26.22 and maximum US$508.70.

4. Prohibited and restricted items while importing into the US

Before exporting from Indonesia to the US, businesses must be aware of certain prohibited and restricted products which are not allowed to enter the country. Prohibited goods are strictly forbidden for entry, while restricted items require additional permits from the relevant authorities. 

In general, products that pose a threat to public health, safety, plant and animal life, or US national interests are forbidden from entering the country. These include:

• Dangerous toys
• Cars without adequate safety measures
• Bushmeat
• Counterfeit currency
• Dog and cat fur products
• Drug paraphernalia
• Illegal drugs and substances

Restricted products that require special permits from a federal agency include:

• Firearms
• Certain fruits and vegetables
• Alcoholic beverages
• Automobiles
• Animal products
• Animal by-products
• Biologicals
• Cultural artefacts and property
• Defence articles or items with military applications
• Medication
• Plants and seeds
• Fish and wildlife

When exporting products from Indonesia, businesses should learn US import regulations so customs clearance can proceed smoothly. Partnering with a reliable logistics carrier like DHL Express ensures your products reach their intended destinations safely and without hassle. Sign up for a DHL Express account today to learn more about how we can help you reliably deliver your products worldwide.