Trade tariffs (customs duties) are taxes collected on imports to increase the price of foreign products in a market they enter. When it comes to the value of the duty, it can be general, MFN, special, preferential, etc., depending on the country of origin. Most importers are interested in customs duties from China, a number one manufacturer. What are tariffs from China?
Importing from China
China is known as “the world’s factory.” It is the biggest exporter of goods in the world and has been for over a decade. China’s exports make up around 15% or more of its GDP.
One of the most important things to do when importing from China is to check local tariffs and other trade barriers, such as certification requirements (such as CE in the EU and UL in the US) and quality standards. Checking the duty rate is crucial since it is used to calculate purchase costs and profitability. Every product category is classified with a tariff classification code.
Below, you can learn how to find duty rates on products from China imported to the US, the EU, and the UK.
Tariffs from China on imports to the US
US duty rates are available in the Harmonized Tariff Schedule (HTS). You can check the duty rate for your product for free on the official HTS website. You can enter the type of product you want to import or its HTS code, which is required for the customs clearance procedure. In the US, tariffs are paid upon entry into the market on cargo valued at $800 and more.
If you import from China to the United States, you must bear in mind that there is an additional tariff for some products manufactured in China (China Section 301). The additional China tariff ranges from 7.5% to 25%. Therefore, the average US import duty on cargo from China is above 19%.
How to search for China tariffs in the HTS?
Enter the product you want to import in the search bar on the HTS website. The example below is a men’s suit jacket made of cotton.
Next to the general duty rate (13.5%) is a note “1/ See 9903.88.15.”
If you look up 9903.88.15, you can see that there is an additional China tariff of 7.5% on top of the 13.5%. So, the overall duty rate for a cotton men’s suit jacket manufactured in China is 21%.
Tariffs from China on imports to the EU
When importing to a member state of the European Union, you can check the tariffs on TARIC. TARIC, the Integrated Tariff of the European Union, has all the information related to customs tariffs for articles in the EU. It is available in multiple languages and free to use. Apart from duty rates, you can check anti-dumping duties, duty suspensions, and more.
EU duty rates on products from China
To check the EU duty rates on products from China, first, enter your product in the search bar in TARIC. You can also filter it by origin/destination.
The example is the same as the previous one, men’s cotton jackets and blazers, HS code 6103320000. The duty rate on products from China is 12%. There is no additional tariff or other protective measures.
This example shows that there is an anti-dumping duty on melamine from China. The general duty is 6.50%, but for some products of Chinese origin, there is an additional duty of 415.00 EUR / 1000 kg. Always check if there are any measures in place apart from the general duty rate.
Tariffs from China on imports to the UK
The United Kingdom left the European Union in 2020, so it is a separate customs territory. Therefore, it has its schedule, UK Integrated Tariff. To find the duty rate on the product you want to import, enter the information in the search bar on the website. Then, you can choose the country of origin.
The duty rate on men’s jackets and blazers of cotton (commodity code 6103320000) from China is 12%. There is no additional tariff on such products.
How to calculate customs duties?
To calculate customs duties paid upon importing cargo, you have to take into account:
- the origin of the goods (here, China)
- the value of the goods
- the customs tariff for the chosen product.
There are many valuation methods, but the most common is the transaction value method, meaning the duty rate is calculated based on the value of the order. To get the overall cost of import, you have to factor in the local taxes (such as VAT), transportation, and insurance costs.
What else is important when importing from China?
If you choose to buy directly from Chinese manufacturers, make sure to verify the company before placing an order. Qualifying suppliers is crucial since there are many illegitimate companies and scammers. Having a background check on your chosen manufacturer saves you money and time in the long run.
Always check, even multiple times, if the product is compliant with formal requirements that are in place in the target market. In order to do that, you should carry out quality control at different stages, like during production and pre-shipment.
Another important thing is protecting your intellectual property. Take protective measures and put Intellectual Property protection mechanisms on legal and commercial levels. At least have your trademark registered in China.
Main photo: dashu83 on Freepik