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What Taxes Are Involved in the Full Process of Import and Export Trade and What Are the Specific Collection Standards?
or complex compliance issues.
clearance and fund security.
I am the person in charge of a small industry-trade integrated factory in Shanghai that has just entered the cross-border e-commerce B2B sector. Last week, I finalized the first full-container order for the EU, and at the same time I need to import a batch of rubber raw materials from Malaysia. When coordinating with freight forwarders and customs brokers these days, they mentioned tariffs and import VAT at one moment, and said that consumption tax and anti-dumping duties may be payable at another, which left me completely confused.
I heard before that a peer had their cargo detained at the port for 3 days due to missed tax payment, spent more than 20,000 yuan in extra port detention fees, and almost lost their customer. Now I am very anxious, and I just want to figure out what taxes are involved in the full process of import and export trade, what are the differences in collection rules for different countries and different categories, and how can a novice like me avoid the risk of missing or paying taxes incorrectly?
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
Many new foreign trade practitioners easily fall into the misunderstanding of "only focusing on tariffs and ignoring other hidden taxes and fees"，such as EU import VAT，consumption tax on some high-energy-consuming goods，and anti-dumping duties on specific categories. If declaration is omitted，the light consequence is a late fee of 0.05% per day，and the heavy consequence is cargo seizure and enterprise credit downgrade，which affects subsequent customs clearance efficiency.
For small and medium-sized industry-trade enterprises，they can enjoy tariff reductions under free trade agreements through Certificate of Origin Application. For example，under the China-ASEAN Free Trade Agreement，rubber imported from Malaysia can enjoy zero tariff with the FORM E certificate，saving about 8%-12% of the cost per container，for exports to the EU，you can apply for VAT Deferment，which eliminates the need to prepay import VAT at customs clearance，meaning the occupied cash flow can be used for domestic production turnover. Calculated based on a 15% VAT rate，an order with a cargo value of 1 million yuan can activate 150,000 yuan of working capital.
In terms of access thresholds，the certificate of origin requires that the proportion of local origin components of the goods meets the standard (usually ≥40%)，and VAT deferment requires filing with the tax authority of the destination country in advance. Dynamic income calculation should be combined with cargo value，tax rate and capital cost. For example，when the annualized capital cost is 4%，150,000 yuan of capital can save about 3,000 yuan in financial expenses in half a year. At the same time，it is necessary to keep a full set of documents for future reference to avoid tax inspection risks.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
Tax-related declarations for import and export trade must strictly match the Harmonized System (HS) code. The tax types and tax rates corresponding to different HS codes vary greatly.
For example, for rubber products, the HS code 40011000 corresponds to a 0% tariff rate, while HS code 40031000 may involve anti-dumping duties, resulting in a comprehensive tax rate of more than 20%. When declaring customs, you should check the accuracy of the HS code in advance.
If the tax declaration is untrue due to incorrect HS code classification, the customs will require you to delete the declaration and resubmit it, and even launch a customs valuation dispute process, which takes at least 3-5 working days. It is recommended to entrust a professional institution to conduct pre-classification in advance and issue a pre-classification opinion as the basis for customs declaration to avoid tax risks caused by classification errors.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
Taxes and fees in the logistics link are directly related to the transportation route and storage method. For example, if you choose to import via Hong Kong transit, if the goods are stored in Hong Kong for more than 7 days, you need to pay Hong Kong storage tax, while there is no such fee for direct import from the place of origin.
In addition, if the goods are detained at the port due to tax issues, in addition to port detention fees, there will also be container demurrage fees, which are usually charged on a daily basis, about 50-80 US dollars per standard container per day. If the detention exceeds 10 days, the fee will double.
It is recommended to calculate all taxes and fees in advance before customs declaration, prepare sufficient funds, and agree on an emergency warehouse transfer plan after port detention with the freight forwarder. If it is expected that taxes cannot be paid in time, you can apply for transfer to a customs supervised warehouse to temporarily avoid high demurrage fees.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
The tax-related structure in cross-border trade should be designed in combination with the tax system of the destination country. For example, not all enterprises can apply for import VAT deferment in EU countries. They need to meet the tax registration requirements of the destination country, and the goods must be directly sold to local enterprises or end consumers.
In addition, if related party transactions are involved, they must comply with the BEPS (Base Erosion and Profit Shifting) rules, and related party pricing must follow the arm's length principle, otherwise the tax authority will adjust the taxable income. For small and medium-sized foreign trade enterprises, it is recommended to adopt the structure of "local company + overseas warehouse", which can enjoy the tax preferences for small and micro enterprises in the destination country, and at the same time reduce cash flow occupation through VAT deferment, reasonably reducing the comprehensive tax burden.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
Tax-related compliance in the foreign exchange collection and payment link must match the tax declaration. For example, the tariffs and import VAT paid during import must be marked with the corresponding tax number when paying foreign exchange to ensure that the capital flow is consistent with the invoice flow and cargo flow, otherwise it will be listed as a key supervision object by the State Administration of Foreign Exchange (SAFE), affecting the subsequent foreign exchange payment quota.
In addition, if RMB cross-border payment (CIPS) is used, it is necessary to ensure that the tax declaration currency is consistent with the payment currency to avoid insufficient tax payment due to exchange rate differences. It is recommended that before collecting and paying foreign exchange, submit tax vouchers, customs declaration forms and bills of lading to the bank together to ensure that the collection and payment materials are complete and meet compliance requirements.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
Import and export trade contracts must clearly specify the tax and fee bearing clauses. For example, when the FOB trade term is adopted, the exporter shall bear the taxes and fees for domestic customs declaration, and the importer shall bear the import taxes and fees in the destination country; if the DDP term is adopted, the exporter shall bear all import and export taxes and fees. If the contract is not clearly agreed, it is easy to cause trade disputes.
For example, some overseas customers will refuse to pay for the goods on the grounds that taxes and fees are not agreed. It is recommended to clearly list the bearing party, specific amount or calculation method of taxes and fees in each link in the contract, and add a catch-all clause for tax adjustment. If the tax increase is caused by policy changes, both parties shall share it in proportion to avoid one party bearing all losses.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
The VAT refund in the export link is directly related to tax-related compliance. Only eligible export goods can enjoy the refund. For example, the goods must be declared and departed from the country, the foreign exchange has been received and verified, and the input invoices are complete and authentic.
If the tax type is not correctly declared during export, for example, declaring taxable goods as tax-free goods, you will not be able to enjoy the refund, and even be required by the tax authority to recover the refunded tax. It is recommended to review the authenticity and compliance of input invoices in advance before export to ensure that the HS code matches the refund tax rate. At the same time, when declaring the refund, submit a full set of documents (customs declaration form, bill of lading, input invoice, foreign exchange receipt voucher) to avoid delay or failure of refund due to incomplete documents.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
From the perspective of supply chain planning, tax costs can be reduced through route optimization and category combination. For example, high-tariff categories and low-tariff categories can be combined for packing, and the comprehensive tax rate can be reduced by using customs classification rules; or you can choose to purchase raw materials from countries that have signed free trade agreements with China to enjoy tariff reductions.
In addition, through the inventory linkage strategy, storing part of the goods in the free trade zone can enjoy the bonded storage policy, eliminating the need to pay import VAT in advance, and paying the tax only when the goods leave the zone, reducing cash flow occupation. It is recommended to establish a tax cost calculation model, combine cargo value, tax rate and transportation cost, select the optimal procurement and sales route, and minimize tax costs.