Tariffs and good value:
Determination of tariff and customs value is one of the most important factors in importation and customs clearance. Failure to clearly declare tariff on the goods can impose significant damages on the importer. The exact custom value of goods is also of vital importance since the entrance fees and some other fees are dependent on this factor
Customs duties and tariffs
The fees paid in the customs for imported goods are divided into several categories:
۱٫ Custom duties that are actually indirect taxes, 2. Costs incurred in return for service, for example the unloading, loading, testing, standard and warehousing fees
Duties are collected by the customs, but costs are collected by service providers such as the Ports Organization at ports, public warehouses at the Customs and The Institute of Standards and Industrial Research. The entrance fee, as defined in paragraph (h) of article 1 of customs administration Act, consists of two parts:
– The customs duty (4% for all goods as set by the parliament).
– Commercial Profit as set by the Government.
Of course, taxes and other duties, including 9% of value added tax, 4% of cultural goods, 1% of total customs duties and commercial profits (entrance fees) as Red Crescent taxes, are also applied on imports of various types of goods according to their type and volume.
Tariffs are taxes on imports or exports that governments charge for support or financial purposes, or a combination of them. Customs tariffs may be collected in proportion to the value of the goods. In this case, the tariffs are referred to as value tariff and are calculated and collected in different ways.
In International Trading, all goods are classified according to a globally harmonized standard, and in the book “the import-export regulations in Iran” (compiled by the Office of Export and Import Regulation of the Trade promotion organization of Iran) goods are classified in 21 sections and 98 chapters and codified in accordance with a 2-8 digit format. The book is published and made available to the public every year. Each commodity has a standard eight-digit tariff code which is used in all organizations, including the Iranian National Tax Administration, the Trade promotion Organization, the Ministry of Industries and Mines, for a common purpose (representation of product specifications)
An international commodity code shows a lot of commodity details, and in the global markets, buyers and sellers of goods actually use the international commodity code or the HS CODE in their invoices.
The exporter (or seller of the goods) is required to define the customs code of the product, and in the event that the HS code is incorrectly defined (whether intentionally or inadvertently), the customs rules and regulations are violated and this act is liable to Administrative penalties ( 50% to 200% of the customs value of the commodities), because the HS code determines the entrance fees and shows whether it is necessary to obtain import licenses from government agencies, therefore, incorrect definition of the code, will impose dire consequences on the owner or the buyer of commodities