How can I avoid taxes and duties when importing products for processing and subsequent re-export?
When goods are imported for processing, i.e. when they undergo some kind of processing, repair, transformation, or value addition before being re-exported, companies are often exempt from paying duties or entitled to a refund. By taking advantage of these benefits, companies can lower their production costs and increase their competitiveness in the global marketplace.
This is also known as a “special purpose customs procedure” or “customs procedure for processing goods with re-export”. This customs procedure usually requires special permits, records and customs documentation to track the journey and processing of the goods. Failure to comply with this procedure can result in customs violations and fines.
Here are some important things to keep in mind:
Customs procedures:Familiarize yourself with all applicable customs procedures, including those relatedto import/export for processing in your country of origin.
Merchandise management: Keep careful records of the imported goods and their movement through the production process. To facilitate thelater export of the finished product, you must explicitly identify and document any imported raw materials or components.
The ability to re-export duty-free depends on the laws in the country of origin, so be sure to review them. In some cases, the commodity must undergo sufficienttransformation in the importingcountryto qualify for an export duty refund.
Enrichment value: Make sure to calculate the enrichment value accurately. This is typically the price differencebetween the imported raw materials and the final exportable product. This value is used to calculate customs benefits or refunds.
Deadlines: Comply with all deadlines related to import/export for processing, including the period in which the finished product must be exported to qualify for duty drawback or refund.
Documentation: Maintain accurate and complete import and export documentation. This includes customs declarations, invoices, certificates of origin, and any other relevant documents.
If you need support with any aspect of this process, consult cargo-partner experts in customs and international trade to ensure a successful and legal import/export of your items.
Best regards,
cargo-partner | transport + iLogistics
