Customs duty is a type of tax paid on commercial transactions carried out through import or export. It is applied for the purpose of regulating, protecting, and taxing trade between countries. Customs duty is paid by the person or entity performing the import or export. So, how is customs duty calculated? Which factors affect the tax rate? Let's examine the details of this topic together.
What is Customs Duty?
Customs duty is a type of tax collected during import transactions. The purpose of this tax can be summarized as encouraging domestic production and protecting imports by introducing an additional cost to a country's imports. Customs duties generally vary depending on the type, country, and quantity of the imported goods.
These taxes also contribute to a country's budget revenues. Their economic effects are quite complex and diverse. The application of customs duties can affect the development of international trade and create tension between the economic policies of different countries. Furthermore, customs duty applications can also hinder initiatives towards the liberalization of international trade.
What Are Customs Duty Rates?
Customs duty rates are one of the tax types based on the taxation system of imported products. Each country is free to determine its customs duty rates, and these rates may vary according to the type, quantity, and origin of the imported products.
A tax rate of 18% is applied to goods coming from countries that are members of the European Union, and 20% to those coming from other countries. If the goods exceed the value of 1500 euros, an additional fee of 20% is collected. Legal entities that export frequently can obtain detailed information by understanding the legislation.
Customs duty is collected based on rates determined for products such as health, cosmetics, food, and books. However, documents brought for research in the fields of medicine and industry may be exempt from tax if they are sent on behalf of laboratories and centers approved by the Ministry of Health.
How is Customs Duty Calculated?
Customs duty is a type of tax applied to products imported into Turkey. This tax is calculated over the value of the imported products and is collected in line with the rates determined in the Turkish Customs Tariff Schedule. The customs duty calculation process is based on the importer's declaration, and the amount to be paid is determined according to the customs value of the imported product and the tax rates specified in the customs tariff schedule.
The factors influential in determining these taxes are the product category, size, content, and price. In addition, customs tax rates vary according to countries and regions, and therefore the calculation process requires highly meticulous work.
When tax debt calculations are performed, the customs tax base determined using the CIF method is taken as the basis. For example, if the value of a product is 150,000 USD, the freight is 15,000 USD, and the insurance cost is 25,000 USD, the customs duty calculation is done as follows: 150,000 + 15,000 + 25,000 = 190,000 USD.
However, the customs tax base is not determined solely by the CIF method. At the same time, tax rates are also regulated according to the GTIP number of the products. The GTIP number is also known as the Tariff Number, HS Code, or Tariff Code.
What Does Customs Duty Do and Why is It Important?
Customs duty is a type of tax specified for imported goods or services, and its primary purpose is to protect products entering the country through import, support the national economy, and regulate commercial activities.
Customs duty plays an important role in trade flows between countries. In a country's trade with other countries, customs duties are an important tool for the protection and sustainability of the country's economy.
These taxes support domestic production and employment by protecting products entering the country through import. In addition, customs duties ensure that trade is conducted fairly and create a fair trading environment by balancing competition among importers.
Customs duties also play an important role in shaping the economic policies of states. Especially in developing countries, customs duties are frequently used to stimulate economic growth by supporting domestic production and employment.
In conclusion, customs duties are an important tool in regulating international trade and protecting national economies. The correct calculation and application of customs duty rates ensure that trade is conducted in a fair and balanced manner and support the sustainability and development of international trade.
How is Customs Duty Paid?
In customs transactions, you may encounter a confusing array of information about the taxes and fines you need to pay. At this point, a range of payment tools such as commercial banks and public treasuries are available. Additionally, there is a special payment tool like GÜMKART.
GÜMKART is a payment tool through which tax payments related to the customs declarations of only the cardholder company can be made. However, after completing your payment, information regarding your declaration is sent electronically via the Ministry of Trade's computer system. In this way, tax and fine decisions regarding your declaration are also automatically closed.
Customs Duty Codes
You can access and check some of the customs duty codes from the table below. For more information, you can examine the Turkish Customs Tariff Schedule.
Code NumberProduct DescriptionTax Rate0702.00.00Tomatoes150%0805.50.00Mandarins, tangerine-like citrus species65%0901.11.00Coffee beans (Arabica)35%1001.90.00Wheat45%1101.00.00Wheat or meslin flour45%1201.00.00Soybeans13.5%1302.19.00Vegetable starches, inulins, glucoses and syrups15-60%1404.90.00Other silks20%1501.00.10Animal or vegetable fats (unrefined)45%1601.00.00Sausages and sausage-like products20-40%1701.91.00Sugar prepared in confectionery form80%1806.90.90Other food preparations containing cocoa and chocolate30-40%1902.11.00Pasta (with egg)20%2009.90.90Other fruit juices20%
What is Customs Duty Exemption?
Customs duty exemption allows individuals and organizations trading under imports, exports, and special conditions from certain countries to be exempt from tax. This exemption is applied within the scope of the limitations and conditions specified in Article 167 of the Customs Law and decision numbered 2009/15481 of the Law No. 4458.
Customs duty exemption provides many advantages in commercial activities. However, a complex set of conditions must be met to qualify for the exemption. For example, when an exemption is requested for the import or export of certain goods, factors such as country, quantity, and other specifications must also be taken into account.
This process covers many documents and laws, including international agreements made between governments. The implementation of the right to customs duty exemption is a highly complex process, as a specific tax rate must be calculated for each transaction.
The right to tax exemption provides a great convenience, especially for exporters. However, abuse of the right to tax exemption is considered a crime and has serious legal consequences.
Turkey Import Customs Duty
One of the biggest challenges that those importing in Turkey will face is the Import Customs Duty. This tax varies according to the value, type, and country of the imported products.
Import Customs Duty is a significant financial obligation for those wishing to do business. In addition, the customs duty on imported products may vary according to factors such as Turkey's economic policies and international trade agreements.
Import Customs Duty rates are determined according to the product groups specified in the Turkish Customs Tariff Schedule. Especially for special products such as luxury consumer goods and high-tech products, the applied tax rates might be higher.
Turkey Export Customs Duty
Turkey Export Customs Duty is the tax levied on the export of goods and is applied to export transactions performed within the borders of the Republic of Turkey. There are many factors influential in determining this tax, but tax exemption can be provided when the conditions and limits determined by the Tax Laws are complied with.
These exemption rights and application methods have been clarified by Article 167 of the Customs Law and decision numbered 2009/15481 of Law No. 4458. Exporters must follow certain procedures to temporarily store their export goods or to exempt goods they wish to bring from abroad from customs duty.
Frequently Asked Questions About Customs Duty
Who Pays the Customs Duty?
Customs duty is paid by the person or entity performing the import or export. Especially in imports, the responsibility for paying tax lies with the owner of the goods or the importing company.
What Is Customs Duty Paid According To?
The amount of customs duty payment is determined based on many factors, such as the type, quantity, value, and country of the imported or exported goods. In Turkey, customs duty rates are listed in a schedule called the Customs Tariff Schedule. In this schedule, tax rates are determined by taking into account many factors such as commercial agreements between countries, as well as the type and quality of the imported goods.
What Happens If Customs Duty Is Not Paid?
If the customs duty is not paid, situations such as holding the goods at customs, not releasing the goods until the tax debt is paid, or applying legal sanctions on the importing or exporting company may occur. In addition, if customs duty is not paid, criminal sanctions may also be applied to the relevant person or entity. These sanctions can include situations such as administrative fines and confiscation of the goods.
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