SUNBIZ

The Basis of Customs

When you bring goods into Fiji you may need to pay Customs duty and other charges on your arrival. What you pay will depend on a number of factors such
19 May 2018 11:00
The Basis of Customs
The Port of Suva is Fiji’s largest, busiest and biggest container and general port providing the maritime gateway to the country’s capital city of Suva

When you bring goods into Fiji you may need to pay Customs duty and other charges on your arrival.

What you pay will depend on a number of factors such as; whether the goods are for your own personal use; whether they are covered by a concession or duty-free allowance and whether they are for commer­cial use.

When taking goods out of Fiji, your goods may incur a fee if they re­quire customs inspection.

Through this article we will find out more about what you may need to pay, the concessions that might apply, how to work out the charges, our methods of payment, and the ex­change rates Customs uses.

 

What is Customs Value?

Customs Value means the value of goods calculated for the purposes of collecting customs duties.

What is the basis of Customs valua­tion?

Customs value is the price actually paid or payable for the goods when sold for export to Fiji.

This includes the cost, inward freight, insurance and all other charges related to the goods being valued.

What is meant by ‘price actually paid or payable’?

The ‘price actually paid or payable’ represents the total payment made or to be made by the Fiji importer for the imported goods.

This include any direct and indirect payment in relation to the imported goods.

What should an importer do if the goods do not have any value or is be­ing donated?

“Customs Tariff Act 1986” stipu­lates that where the customs value cannot be determined under normal circumstances, there should normal­ly be a process of consultation be­tween the customs officials and the importer with a view to arriving at an alternatives basis of valuation.

The Legislation puts a lot of em­phasis on the interaction between the importers and customs officials to determine the customs value in a transparent manner.

What other cost should be included in the customs value for the calculation of duty?

Valuation components are the vari­ous element which must be taken into account in determining the cus­toms value.

The dutiable elements are to be added whereas the non-dutiable ele­ments are to be deducted to compute the customs value.

These are listed below:

Other cost that will be included:

nCommissions and brokerage, ex­cept buying commissions

nThe cost of containers which are treated as being one for customs pur­poses with the goods in question

nThe cost of containers which are treated as being one for customs pur­poses with the goods in question

nThe cost of packing whether for labor or materials

nThe value, apportioned as appro­priate, of the following goods and services where supplied directly or indirectly by the buyer free of charge or at reduced cost for use in connec­tion with the production and sale for export of the imported goods, to the extent that such value has not been included in the price actually paid or payable

nMaterials, components, parts and similar items incorporated in the imported goods

nTools, dies, molds and similar item used in the production of the imported goods

nMaterials consumed in the im­ported goods and engineering, devel­opment, artwork, design work, and plans and sketches undertaken else­where than in the importing country and necessary for the production of imported goods

nRoyalties and license fees related to goods being valued that the buyer must pay either directly or indirect­ly, as condition of sale of the goods being valued, to the extent that such royalties and fees are not included in the price actually paid or payable

nThe value of any part of the pro­ceeds of any subsequent resale, dis­posal or use of the goods that accrues directly or indirectly to the seller

nAdvance payments made earlier but not reflected in the invoice.

Other cost which may be excluded from the Customs value.

nAll discounts except retrospective discounts

nThe following charges, provided they are separately declared in the commercial invoice:

nInterest charges for deferred pay­ment

nPost-importation charges such as inland construction, erection, as­sembly etc, undertaken after impor­tation and

nDuties and taxes payable in the im­porting country

Should the customs value include charges towards freight, insurance, loading, unloading and delivery?

All (Cost insurance and freight)

Customs value is based on CIF (cost insurance and freight) basis which includes the following:

nFreight charges up to the place of importation

nLoading, unloading and handling charges associated with transport of the goods to the place of importation

nThe cost of insurance

How are royalties and license fees to be treated for valuation purposes?

When the buyer pays a royalty or license fees related to the imported goods as a condition of sale, the amount has to be added to the price actually paid or payable.

Examples are payments in respect of patents trademarks, copyrights etc.

The basic requirement for addition of these fees under Article 8.1 (c) of the valuation agreement and Cus­toms Tariff Act 1986.

n such amounts are related to the goods being valued

n the buyer pays these amounts as a condition of sale of the goods being valued.

Payments made by the buyer for the right to distribute or resell the imported goods have to be added to the price actually paid or payable for the imported goods only if such pay­ments are a concondition of the sale for export to the country of importa­tion.

On the other hand, payments for the right to reproduce the imported goods in the country of importation should not be added to the price ac­tually paid or payable for the import­ed goods in determining the customs value.

Feedback: maraia.vula@fijisun.com.fj



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