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  • Writer's pictureMark Boucher

Paying too much customs duty?

You have found the perfect product at just the right price and have negotiated the best transport rates. Don't stumble at the final hurdle, namely the payment of the minimum amount in customs duty and taxes.

What factors are involved? These are the primary ones.

  1. Correct customs valuation. The price you paid the supplier for the goods is not necessarily the value upon which customs duty is to be paid. Ensure that you have the correct valuation point and have made the allowable deductions.

  2. Correct tariff classification. With the advancement of technology and innovation, assigning the correct tariff heading to a product can often be a tricky process. It is important to obtain full technical specifications and the process of manufacture and end use application (where applicable) to place you in the strongest possible position to assign the correct tariff heading.

  3. Correct origin determination. Depending on the country of export, country of import and the countries in which the various stages of manufacture have taken place, there could be significant savings under a trade agreement signed between the countries of import and export.

  4. Rebates. Certain raw materials and in certain cases, finished goods, qualify for a full or partial rebate of customs duty and taxes.

  5. Final destination of the goods. If the final destination of the goods is not the first country of importation, then the goods may either be removed in transport or placed in a bonded warehouse, pending removal to the final country of destination. In both cases, a guarantee covering the potential duty and taxes may be lodged in lieu of payment of the duties and taxes.

If you are considering the purchase of a valuable consignment of cargo, it is well worth hiring an expert to calculate the correct duties payable on your behalf.

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