To amend the Internal Revenue Code of 1986 to impose a tax on United States-bound circumvented cargo through Canada or Mexico and entering the United States.

Bill Summary: H.R. 3363 - Cargo Circumvention Tax

Overview

H.R. 3363 proposes an amendment to the Internal Revenue Code of 1986 to establish a new tax on cargo entering the United States that has been routed through Canada or Mexico to bypass direct entry points. The bill is designed to address "cargo circumvention," where goods are offloaded from ocean-going vessels in neighboring countries and then transported across the border into the U.S. via land or air.

Key Provisions

1. The Cargo Circumvention Tax

The bill creates a new subchapter under the Internal Revenue Code to impose a specific tax on "United States-bound circumvented cargo."

• Tax Rate: The tax is set at 0.125% of the value of the cargo, as determined by U.S. customs laws.
• Liability: The financial responsibility for paying this tax falls upon the importer of the cargo.
• Timing: The tax is imposed at the moment the cargo enters the United States.

2. Definition of "Circumvented Cargo"

The bill specifically defines "United States-bound circumvented cargo" as any cargo that meets the following criteria:
* It is discharged from an ocean-going vessel in Canada or Mexico.
* It subsequently enters the U.S. via rail, highway, airport, or inland port.
* This includes cargo that remains in intact intermodal containers, as well as cargo that is modified, assembled, or consolidated while in Canada or Mexico.

3. Regulatory Authority

The Secretary (of the Treasury) is authorized to issue necessary regulations and guidance to implement the tax, including the establishment of collection procedures and penalties for those who fail to comply.

Affected Parties

• Importers: Businesses or individuals importing goods into the U.S. via Canada or Mexico will be directly responsible for the new tax.
• Logistics and Supply Chain Operators: Companies utilizing "land-bridge" routing (offloading in Canada/Mexico to avoid U.S. ports) may face increased operational costs.
• International Shippers: Those routing goods through North American neighbors may see a decrease in the cost-effectiveness of these routes.

Timeline and Procedural Status

• Effective Date: If passed, the tax will apply to cargo entering the United States after December 31, 2025.
• Current Status: As of May 13, 2025, the bill has been introduced in the House and referred to the House Committee on Ways and Means.