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Customs· 2 min read

Import taxes from China: duties and VAT

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When you import from China, on top of the product and transport price you must add the taxes charged at customs. Understanding them well is the difference between calculating your margin accurately or getting a nasty surprise on the assessment.

In this guide we explain the two main taxes —duty and VAT—, how they are calculated step by step, and what other items may appear.

The import duty

The duty (or customs duty) is charged on goods entering the European Union. Its rate depends on the product's classification in the common customs tariff, identified by the TARIC code. It varies widely: some products are at 0% and others above 12%. That's why classifying the goods correctly is essential: a wrong code can make you overpay or commit an offence.

Import VAT

On top of the duty, import VAT is charged. In Spain the general rate is 21% (with reduced rates for certain products). What matters is the base: it's not just the value of the goods, but the customs value plus the duty plus the transport and insurance costs up to the EU border.

How it is calculated, step by step

  • Customs value: value of the goods (invoice) + freight + insurance to the EU.
  • Duty = customs value × tariff rate (per TARIC).
  • VAT base = customs value + duty.
  • VAT = base × 21% (or the applicable rate).

A worked example

Goods worth €5,000, freight and insurance €800, a 4% duty: the customs value is €5,800; the duty, €232; the VAT base, €6,032; and VAT at 21%, €1,266.72. In total, €1,498.72 of customs taxes on goods worth €5,000.

Is VAT a real cost?

For a trading company, import VAT is deductible: in the medium term it's not a cost but a cash-flow advance. The duty, however, is a cost you don't recover. For individuals, both are a final cost.

Other items that may appear

Some Chinese products carry anti-dumping duties (surcharges to prevent unfair competition, common on bicycles, solar panels or fasteners) or excise taxes. It's worth checking before buying, as they can push up the final cost.

How R'S WARE helps you

We classify your goods correctly, calculate the taxes before you buy and, with the DDP model, give you a fixed price with duties and taxes included so there are no surprises on the assessment.

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