Shipping items overseas can be a lucrative expansion for your business. When shipping internationally, it's important to understand what duties and tariffs may be owed.
In this article, we break down what duties and tariffs are, who is responsible for paying them, and how to stay informed about a country's duty fees and regulations.
Duties and Tariffs Explained
What Are Duties and Tariffs?
Duties and tariffs are taxes imposed by a government on goods imported or exported across international borders. They are designed to regulate trade, protect domestic industries, and generate revenue for the importing country. Duties are specific taxes on imported goods, while tariffs are broader taxes on international trade.
Who Pays Duties and Tariffs?
The responsibility for paying duties and tariffs often falls on the importer, which is typically the buyer or the business receiving the goods. However, it's crucial to establish clear terms with your customers to determine who bears these additional costs. In some cases, businesses may choose to include these fees in the product price or offer transparent information to customers about potential additional charges.
Managing the Impact of Duties and Tariffs
Below are some are strategies to minimize the impact of duties and tariffs:
Shipping Cost Transparency: Communicate shipping costs and potential duties to customers during the checkout process.
Use Harmonized System (HS) Codes: Properly classify your products with HS codes when declaring them for international shipping. This ensures accurate assessment of duties and tariffs.
Explore Free Trade Agreements: Investigate if the countries involved have free trade agreements that may reduce or eliminate certain duties for specific goods.
Utilize Special Programs: Some countries offer special programs or exemptions for certain types of goods. Research and leverage these programs to reduce costs.
Finding Duty Fees and Laws
Understanding a country's duty fees and laws requires research and diligence:
Government Websites: Check the official government websites of the importing country for the most accurate and up-to-date information on duties, tariffs, and import regulations.
Customs Brokers: Collaborate with customs brokers who specialize in international trade. They can provide valuable insights and assistance in navigating complex customs regulations.
Trade Associations: Connect with trade associations or chambers of commerce in the target country. They may offer resources and guidance on local regulations.
Consult with Legal Experts: If in doubt, seek legal advice from professionals specializing in international trade law. They can offer tailored guidance based on your specific situation.
If you have further questions or need assistance, our support team is here to help you every step of the way. Happy shipping!