How are Duties and Taxes Managed when Shipping Internationally?

Any item shipped internationally will have to go through customs. The customs department will decide whether an item will be charged tax or not. There are many types of taxes that can be levied on an item being shipped into a country. The only exception is any item that is of very little value and which is not on any prohibited list or list of restricted items. Even personal gifts beyond a nominal value would be taxed.

Typically, there are three kinds of taxes that are levied on goods being shipped internationally. One is the value-added tax. All kinds of items are charged a value-added tax barring those that are charged customs or excise duties. Excise and customs duties are charged for tobacco products, alcohol, perfumes, and any such material that will be listed by the customs department of the country. Other than country-specific laws and regulations, there can be a few regional laws as well. For instance, the EU has a tax that is charged in all countries that don’t require a parcel being shipped within the EU to be charged any excise duty. A parcel to the Netherlands from Germany will not be taxed with an excise duty because it is already accounted for.

All duties and taxes are paid to the specific country’s customs department, but the customer or the sender doesn’t pay such fees directly. When shipped through a company like a counterpoint, it is the job of the courier to pay such duties and taxes to the specific departments in the destination country and that cost is accounted for in the cost of couriering.

When goods are shipped internationally, they aren’t just charged for the courier services, all possible taxes, and excise duties if applicable are included in the total amount. The courier company then makes the payment. Typically, couriers and the customs departments keep a detailed record of all items being shipped by a particular courier and the accounts are audited periodically for accuracy and adherence to the regulations.

When some items don’t have a particular amount of taxes or duties and there is a range, the maximum tax or duty is charged to the customer or sender, and accordingly, the courier company pays whatever is charged by the destination country. The only time when senders or clients pay the duties or taxes directly is when they have an export license or are registered as traders in the destination country and can directly make payments over a period of time. Such a situation is only applicable when a company keeps sending a certain type of consignment regularly.

Leave a Reply