Understanding Shipment Related Taxes: A Guide for Businesses

Shipping goods across borders involves more than just logistics; it also entails understanding the various taxes and duties associated with international trade. Shipment related taxes can significantly impact the cost and profitability of a business transaction.

There are many confusions that arise when a shipment related tax is being asked of a customer to pay, we have questions like “why do I have to pay another money after I have paid the shipping fee” another question like “why is the charge so high” and asks for a negotiation or refuses to pay.

This guide got you covered. Keep reading to explore what it is and all you need to know about it.

CUSTOM CLEARANCE

Customs clearance involves taking the goods from the customs authorities after paying the stated fee to facilitate the movement of the shipments inside the country (if it’s imported) or outside of the country (if they are exported).

CUSTOM CLEARANCE FEE AND CHARGES

A customs clearance fee is levied by the customs clearance agent or customs broker to cover the cost of preparing and filing customs documents. It is charged to cover cost incurred in clearing the parcel/postal item on behalf of the addressee. These charges will also include duties and taxes as applicable and stipulated by the destination country. These charges are most times determined after the shipment has gotten to the destination country.

 

Now we will look at questions people do ask and their answers.

 

  • Who pays International Shipping Customs Charges?

Customs duties are usually paid by the receiver unless otherwise agreed with the sender.

The amount that the receiver would need to pay depends on the information provided in the custom declaration, as well as any supporting documents or additional information that may be requested by the customs officers.

 

  • How much are the custom charges for my international shipment?

The customs official will identify the applicable taxes per the details presented in the papers. The exact payable duties depend on the type and value of the cargo, the item you are shipping and the country’s regulations.

 

  • What Happens if I refuse to pay customs fee or charges for international shipping?

If you refuse to pay the customs clearance fee, there are two possible scenarios:

  • If you choose not to pay the customs fees for your international shipment, the package may be discarded or destroyed.
  • In the event that you refuse to pay the customs fees for international shipping, the package may be sent back to the sender. Please note that in this, the sender will be responsible for covering the additional shipping costs.

 

  • Can I avoid paying customs clearing charges for my international shipment?

Unfortunately, you cannot avoid paying the customs clearance costs if you want to receive the shipment. These costs are determined by the destination’s government requirements and are not within the control of the courier or sender.

 

Conclusion:

Navigating shipment related taxes requires careful planning, compliance with regulations, and an understanding of the tax landscape in different countries. By staying informed and working with experienced professionals like Dreamworks Global Logistics Limited, your businesses can maximize their competitiveness in the global marketplace.

 

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