Import-export Manual – Customs tariff and duties

THE CUSTOMS TARIFF

The customs tariff is a collection, subdivided by product sector, of tariff headings which are marked both with a code (the so-called “heading”) and with a description (designation) which correspond to the goods being traded internationally. The tariff heading is indispensable to determine the duty to be paid to the authorities in charge of goods customs clearance. The international convention in force introduced a coding system for goods, which is known as Harmonised System (HS). The HS is arranged in 21 product sections which are divided into 99 chapters and these are subdivided into headings and subheadings which are identified by a 6-digit code.

EUROPEAN COMMUNITY CUSTOMS TARIFF

In the EU, the 6 digits of the Harmonised System may be complemented by other digits which correspond to other subdivisions. In particular, there are:
• the Common External Tariff (the so-called Combined Nomenclature, CN) which groups about 9,500 headings, each of them being identified by an 8-digit code (the first 6 digits are the HS codes, while the last 2 correspond to the CN subheadings). Next to each heading, the CN indicates the autonomous duty (which is decided autonomously by the EU) and the conventional duty (as a result of international agreements signed by the EU). The CN is required in bill of exports and INTRASTAT forms (both for intra-community supplies and for intra-community acquisitions).
• the Integrated Tariff of the European Community (TARIC) which groups about 13,000 headings each of them being identified by a 10-digit code (compared to the CN, the additional 2 digits identify any preferential duties and other specific measures). For import transactions, the code referred to the goods must be of 10 digits.

THE NATIONAL TARIFF OF USE

The national tariff of use is a 14-digit code which is composed of: 6 HS digits + 2 CN digits + 2 TARIC digits + 4 additional digits. With respect to these 4 additional digits, the first 2 concern EU taxation system, VAT and excise taxes, while the remaining digits concern specific information (e.g. anti-dumping duties, reference prices for wines, products concerning endangered species of fauna and flora, goods of artistic and cultural interest, etc.). The national tariff of use is the operating manual for customs agents and can be found in the “AIDA” (Automazione Integrata Dogane Accise, Integrated Automation Customs Excises) database of the Italian Customs Agency (Agenzia delle dogane).
IMPORTANT: in case of doubts on the correct classification of goods, it is possible to obtain an official opinion from the customs authority by filling in the relevant form. The form is also found on the website of the customs authority. This form must contain a detailed description of the goods as well as their supposed classification. This request must be sent to the customs office which is competent for the territory where the company is based, or to the office where customs clearance is expected to take place.

DUTIES

In all import-export commercial transactions, a very important heading is that concerning customs duties. Customs duties are taxes which are usually expressed as a percentage of the value of goods, and they are levied on imported goods when they are released for free circulation in the customs territory of the country of destination. The duties must be paid to the customs office from which the goods enter. With the expression “release for free circulation”, we mean the completion of the customs formalities (including the payment of duties) aimed at introducing the goods into the country of destination, thereby clearing them through customs and allowing their free movement. Exceptions are taxes (VAT, excise taxes, taxes on consumption) which are due to the country of destination for the release for consumption.

With respect to Italy, depending upon the countries and the type of commercial transaction to be carried out, there are two different sources of information:
• In the case of an importation from a non-EU country, the reference source is the website AIDA On-line (a website of the Italian customs authority);
• In the case of an exportation towards a non-EU country, the official source to rely upon is the website “Market Access Database” (a website of the European Commission).