Customs duty is assessed on the fair market value of imported goods at the time they are landed in the UK. Import prices for products entering the UK from non-EU states generally consist of: Cost, Insurance, Freight and Duty, with VAT of 15% levied on the aggregate value. This sum is the exporter’s “landed cost, duty paid.”
The commercial invoice value is usually accepted as the normal price, but if a preferential arrangement has been established between the overseas supplier and the importer, or an unrealistic value has been declared, HM Revenue and Customs (HMRC) reserves the right to assess a fair market value for duty purposes. The duty is payable at the time the goods are imported, but established importers can defer payment for an average of 30 days. In addition to customs duties on imported goods, an excise tax is levied on in-country sales of alcohol, tobacco, and road vehicles, and on sales of oil and petroleum products.
The applicable import duty and excise tax rates can be obtained from U.S. Department of Commerce Export Assistance Centers, and copies of the tariff can be purchased from HMRC Stationery Office.
In March 2004, as a result of the WTO ruling concluding that U.S. FSC/ETI provisions of the Internal Revenue Code constituted prohibited export subsidies, the European Union imposed additional duties to a number of products, in retaliation to the BYRD Amendment. EC Regulation 673/2005 allows the EC to raise or lower retaliatory rates dependant on the subsidies the US paid its companies. In effect this means each year the additional rate of duty or the scope of the goods covered could be adjusted as necessary to provide balance.