Import Duty and VAT Calculation Guide

Import duty and VAT are important components of logistics costs.

Basic Concepts

• Import Duty: Tax on imported goods, rate determined by HS code
• VAT: Consumption tax on top of duty
• Combined Rate: Total of duty + VAT

US Duty Calculation

US duty formula:

Duty = Declared Value × Duty Rate

• Section 321: Duty-free under $800
• Duty rate: 0-25% depending on HS code
• No VAT (US has no national VAT)

EU Duty Calculation

EU duty formula:

Duty = CIF Value × Duty Rate

VAT = (CIF Value + Duty) × VAT Rate

• Duty rate: 0-20%
• VAT rate: Varies by country, about 17-27%
• IOSS: Pre-declare VAT

UK Duty Calculation

• Duty rate: 0-20%
• VAT rate: 20%
• Under £135: Duty-free, VAT still required

Cost Reduction Strategies

1. Use duty-free thresholds: Like US Section 321
2. Declare value correctly: Avoid low declaration
3. Use Certificate of Origin: Get tariff preferences
4. Choose right HS code: Select lower rate code
5. Choose DDP channels: Inclusive of tax