Tariff evasion is the illegal underpayment of customs duties through false or misleading information given to customs authorities. In the US it usually involves a false country of origin (including transshipment), a declared value lower than the price actually paid, or a misdescribed product. It is different from lawful tariff planning, such as genuinely moving production to another country. Evasion can bring civil penalties under 19 U.S.C. 1592, liability under the False Claims Act, criminal charges and loss of the goods.
Key Takeaways
- Tariff evasion means underpaying duty through false origin, value or description.
- Penalties under 19 U.S.C. 1592 scale from negligence to fraud, and lost duty must be repaid.
- EAPA and the False Claims Act add investigations, treble damages and whistleblower suits.
- Accurate origin, value and classification records are the best protection.
This article explains the law so honest importers can stay compliant. It is not legal advice; speak to a customs attorney or licensed broker about your situation.
What Counts as Tariff Evasion
| Type | What it means | Why it is illegal |
|---|---|---|
| Transshipment / false origin | Declaring goods as made in a country where they were not substantially produced | Origin decides which duties apply, so a false origin is a material false statement |
| Undervaluation | Declaring less than the price actually paid or payable | Duty is calculated on value, so revenue is lost |
| Misclassification or misdescription | Declaring a product as something it is not to reach a lower rate | The HTS code sets the rate and extra duties |
| AD/CVD evasion | Avoiding antidumping or countervailing duties owed on covered goods | Investigated under the Enforce and Protect Act |
Lawful planning looks different: real changes in where and how a product is made, correct classification of a genuinely redesigned product, or using an exclusion your product truly meets.
How the US Enforces: 1592, EAPA and the False Claims Act
19 U.S.C. 1592 prohibits entering goods using material false statements or omissions through fraud, gross negligence or negligence. The statute sets maximum civil penalties:
- Fraud: up to the domestic value of the merchandise.
- Gross negligence: up to the lesser of domestic value or four times the lost duties (40% of dutiable value if duties were not affected).
- Negligence: up to the lesser of domestic value or two times the lost duties (20% of dutiable value if duties were not affected).
Lost duties must be repaid whether or not a penalty is assessed. Clerical errors are not violations unless they form a pattern of negligence.
EAPA investigations let an interested party allege that an importer is evading AD/CVD orders. CBP’s EAPA page shows a timeline with an interim measures decision around day 90 and a determination around day 300 to 360.
The False Claims Act makes anyone who knowingly avoids an obligation to pay the government liable for three times the damages plus a penalty, and lets whistleblowers file suit. In July 2026 the Justice Department said its Trade Fraud Task Force, launched in August 2025, had passed $1 billion in recoveries and charged losses, naming transshipment, mislabeling and false declaration, with Section 301 evasion as a priority.
How Honest Importers Stay Compliant
- Know your supplier: confirm the factory that actually makes the goods. Our factory audit checklist helps.
- Declare the full price paid, including any additions your broker identifies.
- Classify from the product’s real function and keep the reasoning on file.
- Match origin marking, invoices, ISF and entry data. See rating labels and required markings.
- Be wary of offers that promise to “lower duty” through paperwork alone.
- If you find an error, ask counsel about a prior disclosure, which can sharply limit penalties under section 1592.
What It Means for EV Charger Buyers
Chinese EV chargers currently carry several duty layers, which raises the temptation and the scrutiny. Downstream buyers can be exposed too: the Justice Department says the task force’s mandate covers importers, brokers and distributors who knowingly profit from goods entered contrary to law. EVDANCE manufactures in its own Shenzhen factory, marks true origin on products such as the EV-ACS3210T 32A portable charger, and issues invoices that reflect the real price. Talk to our team about compliant FOB or DDP shipments.
Frequently Asked Questions
Is tariff evasion the same as tariff avoidance?
No. Evasion relies on false information. Avoidance, such as genuinely sourcing from another country, is lawful when the facts are real and declared correctly.
Can an honest mistake lead to a penalty?
Negligence can, but clerical errors alone are not violations unless they form a pattern. Correcting errors promptly matters.
Who can be liable besides the importer?
Section 1592 also covers anyone who aids or abets a violation, and False Claims Act cases can reach other parties who knowingly take part.
Related Reading
- Importing EV Chargers Into the US: Customs, HTS and Section 301
- Chinese EV Charger Manufacturers: Factory, Trading Company or Marketplace Seller?
- Product Liability for Private-Label EV Charger Brands
- Pre-Shipment Inspection and AQL Sampling for EV Charger Orders
