How are import duties calculated?

28 December 2021

If you import goods from outside the EU, your import duty costs will have risen considerably since the start of the coronavirus pandemic. This is a direct result of the increased freight rates. However, this connection is not immediately obvious to many importers, as we realised from the number of questions we receive on this subject. How does it work?

Customs value and import duties

The import duties you pay are calculated using the so-called customs value. This is the sum of:

• Transport costs up to the Dutch border
• Value of the goods
• Insurance costs of the goods

The customs value is also referred to as the CIF-EU border rate. CIF stands for Cost, Insurance, Freight. This includes all the costs mentioned above up to arrival at the Dutch port. You then pay a certain percentage of this customs value in the form of customs duties.

Transport costs and import duties

Imagine you import clothing from China. You pay 12% import duties for these goods. In the example below, the value of the goods and the costs of insurance stay the same. Only the transport costs are different. What amount of import duties do you pay in each of these situations?

Example 1

Transport costs: €15,000

Value of the goods: €4,900

Insurance costs: €100

The customs value is €20,000.

How much are your import duties?

12% of €20,000 = €2,400

Example 2

Transport costs: €2,000

Value of the goods: €4,900

Insurance costs: €100

The customs value is €7,000.

How much are your import duties?

12% of €7,000 = €840

Please note: The customs value is always paid in EUR. It depends on the monthly rate (in Dutch) used by the customs authorities.

In example 1, the cost of transport is 7.5 times that of example 2. This also increases the customs value, so that the amount for which you are liable to pay import duties is also higher. As such, one directly affects the other. It is how higher freight rates also lead to higher import duties.

Questions?

If you have any further questions about the customs value or import duties, our customs declarants are happy to help. Please contact our customs declarants on 010-7671000, or send an e-mail to info@ritra.nl.