Customs
How Import Duty Is Calculated
Tutorial: customs value × duty rate, HS classification, origin proof, and worked arithmetic.
Duty = Customs value × Applicable rate. Confirm HS code, origin, and any additional tariffs.
Basic Formula
Import duty = Customs value × Duty rate
Customs value is set per national law — commonly CIF at port of entry. Rate comes from tariff schedule keyed to HS code digits.
HS Classification
Correct HS code determines rate and any import licenses. Binding rulings reduce dispute risk for new products.
6-digit HS is harmonized; countries add national suffix digits.
Origin and Preferential Rates
Same HS code may have MFN vs FTA rate. Importer must present valid COO format accepted by customs.
Non-preferential COO still proves origin for rules other than duty.
Additional Duties
Anti-dumping (AD), countervailing (CVD), safeguard, or Section-style trade remedies add on top of base duty.
Check trade remedy databases when sourcing from sensitive origins.
Payment and Declaration
Broker files entry; duty paid before or at release depending on regime. Penalties for misdeclaration include fines and increased inspection rates.
Examples
Numeric
CIF USD 20,000 · Rate 7% → Duty USD 1,400 before VAT.
Preferential
Same CIF · MFN 7% vs FTA 0% with COO → USD 1,400 saved on duty alone.
FAQ
- Duty on freight?
- If customs value is CIF, freight is inside the base — duty applies to freight portion too.
- Minimum duty?
- Some lines have specific or minimum duties per unit — check tariff notes.
- Currency of duty?
- Declared in local currency per customs FX table on entry date.
- Provisional duty?
- Under review cases may use deposit pending final rate.
- Relief programs?
- Zones, temporary admission, and aid imports may reduce or defer duty.
Conclusion
Validate HS and rate before PO placement. Link duty results into Import Duty and Landed Cost.