![custom duties, what are custom duties, types of custom duties](/sites/default/files/2024-08/custom%20duties.jpg)
- Date of publication
- Agosto 2024
- Business
- Article
Customs duties are the taxes that you must pay on products shipped from international countries. Companies from all walks of life use them, both large and small. Knowing what customs duties are, and their types is key to success in foreign trade. This article explains what customs duties are and studies the topic in depth, as well as their categories, and in particular, international business at ESIC.
What are customs duties?
Would you like to study our Bachelor's Degree in International Business? Access for more information.
What are customs duties? Let us take a look at the definition and purpose of customs duties. The process of receiving the set of materials you have ordered can also be delayed by customs duties, i.e., taxes on foreign goods that enter or leave countries The purpose of these duties is to earn revenue, protect domestic industries and regulate incoming and outgoing contingent goods.
Customs duties can be calculated in numerous ways, such as the value of the type of goods, weight etc. Depending on the country of origin, type of product, and trade agreements signed, tariffs can vary considerably.
Types of customs duties
The many types of customs duties serve various functions and purposes. Main Types of Customs Duties:
Ad valorem duty
This type of e customs duty a percentage of the FOB price. If the duty rate is 10%, and the goods are valued at $1,000 then the ad valorem duty will be =$100
Specific duty
As the name suggests, specific duties are imposed at a specific amount per unit of weight, volume or quantity and unlike ad Valorem duties, they do not vary with the market price. A specific duty is a customs duty rate that depends on the quantity, weight, volume or other objective measures (e.g., chemicals), regardless of the value (for example, $5 per kilogram fabric).
Compound duty
A compound duty is a combination of an ad valorem and a specific duty. An example of a compound duty is one comprising an ad valorem rate + $2 per weight unit.
Anti-dumping duty
This duty is levied only if a country exports a product at a price lower than its normal value, thus harming domestic producers of similar goods. To protect domestic producers by increasing the cost of dumped goods - making them nearly as expensive as locally manufactured products.
Countervailing duty
An anti-dumping duty imposed to offset subsidies by foreign governments on their exports. These duties help domestic industries compete on a level playing field by countervailing the preferential treatment foreign producers receive through subsidies.
Importance of customs
An overview on what customs duties are, and the types of customs duties. They have an impact on how much imported goods cost, which can affect pricing strategies and ultimately, market competition. Exporters can charge their products competitively and plan their logistics effectively if they know the respective customs duties of various countries.
How customs duties Impact trade
Customs duties form an important aspect of crafting international trade relations. They can promote or discourage trade between them for individual countries. For instance, placing high customs duties on certain products can increase prices too much in the importing country which will not be good for that country’s consumers, since this reduces their purchasing power along with market access of some exporting firms. On the other hand, low or zero customs duties in free trade agreements can increase trade by being cheaper for importers and more accessible to consumers.
ESIC University’s Bachelor’s Degree in International Business
The ESIC Bachelor’s Degree of International Business in Spain is perfect for students who have a strong desire to learn all the movements that take place worldwide in international trade, such as customs duties. This program offers a comprehensive basic notion of international business practices, trade regulations and economic policy.
Why choose ESIC University?
For a number of reasons ESIC University provides a very complete education in International Business:
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Comprehensive Curriculum: The program is a comprehensive curriculum that provides a knowledge of various aspects of international business, such as trade policies, global marketing and cross-cultural management. This in-depth study of customs duties and other aspects of trade regulations can be an eye-opener for students in terms of global commerce.
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Expert Faculty: Subject experts and renowned academics who are authorities in international business. The ESIC Faculty has real-world experience and is passionate about this subject.
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Industry Connections: Leverage the university's strong relationships with businesses and organizations across the globe. As a result, these connections have helped students find internships and industry projects and also provided them with various networking events that provide them with better job prospects.
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State-of-the-Art Facilities: Modern facilities and resources with the best learning methods. On campus at ESIC University, we have all the technology and infrastructure to enable you to receive quality training.
Career Opportunities with a Degree in International Business
It might sound quite simple, but a career as an international trade analyst, global supply chain manager or even a position in your hometown observing and creating new products and services is necessary for local markets. For example, to work there as an International Marketing Manager. For these positions, it is important to know about customs duties and other obstacles that can help them easily learn about the complex world trade process.
Graduates with international business degrees have opportunities in areas such as manufacturing, services, finance and trade organizations and non-profit businesses. They are also a beneficial asset for companies looking to increase their operations and market presence on an international level, as they have expertise in global trade practices and regulations.
Challenges and considerations related to customs duties
Customs duties are indispensable to control trade, but they also present potential challenges and issues for mechanisms in place. Compliance with customs duty regulations requires an in-depth knowledge of the respective acts and processes. This may lead to penalties, delays and cost increase for non-compliance.
Another necessity is for businesses to be familiar with customs duty rates along with any trade agreements subject to change that could negatively influence their activities. The cost of goods and how quickly they pass through borders depends on tariff wars, changes in trade policies and new regulations.
Customs Duties are something every business with international trade operations should be knowledgeable about. Such duties impact the pricing, cost and competitiveness of any product in the global market. The ESIC University Bachelor's Degree in International Business provides an excellent opportunity for those with a strong interest in getting ahead and forging a career in the world of international business.
Learn to make a difference in international markets with our training and expertise on the complexity of global trade at ESIC University.
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