Import duty: can we have some clarification here please?

Customs charges depend on which side of bed the customs officer in question got out of that morning 

Enrique Dans
Enrique Dans

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There may still be a case for continuing the practice of imposing customs duties on some items we buy from other countries, mainly in favor of boosting government tax revenue. In any event, there is often no avoiding it. But when a government decides that every electronic device we buy from abroad be subject to import duty, we should at least be told what the amount will be, so that we can decide if buying such goods is worth the effort.

The problem is that the amount charged seems to be plucked from the air: it may depend on the carrier, or tax offices may decide on the basis of banks of monkeys sitting before calculators. This can’t go on. We live in an age when online purchases now make up a significant proportion of what we spend, and therefore, if we are to pay taxes on these goods, we should at least have the right to know on what basis taxes are established.

I recently purchased online a Pebble Steel smartwatch for $229. The carrier was DHL, which sent me a message when the item arrived in Spain, telling me that I would have to pay €110 to cover “VAT, customs duty, and customs office costs.” Needless to say, I cancelled the purchase and sent the item back to the seller. I buy a lot of electronic goods online, and I never know whether I will have to pay import duty. The decision seems to be entirely arbitrary.

Regardless of the current law on this matter, this is an absurd situation. Nobody, either seller or buyer, seems to know if they are going to have to pay import duty, on what type of items, how much it will be, or on what basis the tax is levied. Most importantly, one never knows how much one will have to pay. All you can do is order your goods, take a risk, and if you are asked to pay taxes, cough up and smile, or send them back. This is clearly not acceptable, and something needs to be done about it.

It’s quite simple: either there are taxes, or there aren’t. But this whole thing of “sometimes you win, sometimes you lose,” on the basis of which side of bed the customs officer in question got out of that morning, or how many items he or she has to sift through, or on God only knows what other basis, is utterly insane. It’s as if there were bandits waiting when you arrived at customs that might, or might not, choose to rob you.

I wrote about this issue back in 2008, since when, I have not had to pay import duty on goods bought online — and I do indeed buy a lot of stuff online! How sad that something so absurd has raised its ugly head after so much time…

(En español, aquí)

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Enrique Dans
Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)