Ruling of the Week 3: Mmmm Cinnamon Rolls
The New York Times occasionally profiles a business
traveler. One of the questions the paper asks is whether the traveler has any
secret airport vices. It surprises me that more of the profile subjects do not
say cinnamon buns. Very few things on Earth smell better than airport cinnamon
buns. But, I will admit, I do not think I have ever actually eaten one. They
seem to me to be sized for a family of six. That is not intended to sound
virtuous. I am not opposed to the airport beer or the airport milkshake. On
rare occasions, I will indulge in the airport McFlurry. But, I find the
cinnamon roll to be altogether too daunting a challenge.
Which brings me to the ruling of the week: HQ H158455,
which is still proposed.
The importer had requested a ruling on the tariff
classification of unbaked cinnamon rolls imported for retail establishments to
proof and bake. Originally, CBP classified them as food preparations of flour
in HTSUS item 1901.90.90. Apparently, the importer was not happy with that
result and asked CBP to reconsider the ruling. In that request, the importer
provided additional information including details of the dry weight of the
various ingredients. It may not surprise you to learn that more than 10% of
that dry weight was white sugar derived from cane or beet.
Do you know what that means? It is not necessarily a good
thing for the importer.
It means that the unbaked cinnamon rolls are classified in
HTSUS item 1901.90.56 as products containing 10% or more sugar. That puts the
products under the sugar quota system. If the goods are not from Mexico and the
quota limit is filled, the duty on the merchandise is going to go from 10% ad
valorem to 23.7 cents per kilo plus 8.5%, which I assume is more than 10%.
Is there a lesson here? For purposes of learning about
tariff classification, this is a straight up GRI 1 analysis. The only fact that
changed and resulted in the revocation was that Customs got better information
from the importer about the product. From a strategy perspective, keep in mind
that the facts you present may have apparently unintended consequences.
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