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Guide to Customs Administration

Methods of Determining Dutiable Value

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Flow chart of determining the dutiable value of imported goods

Flow chart of determining the dutiable value of imported goods

Flow chart of determining the dutiable value of imported goods Description

Deducting the deduction elements from transaction price

The dutiable value of imported goods is determined in principle based on the transaction price actually paid or payable by the importer to the exporter in order to buy such goods (first method). In cases where the dutiable value cannot be determined based thereon, the following methods are sequentially applied; provided, however, that the fifth method may be applied in advance of the fourth method in cases where the person liable for duty payment makes a request for it:

  • Transaction price of goods of the same kind and quality (second method)
  • Transaction price of similar goods (third method)
  • Domestic sale price after import (fourth method)
  • Price obtained by calculating the production costs (fifth method)
  • Price obtained by applying other reasonable standards (sixth method)
First method

The first method is the principled method that determines the dutiable value of goods. Most dutiable values are determined by the first method that determines the dutiable value of imported goods based on their transaction price.

Second method

In case where the first method cannot be applied, the second method is used to determine the dutiable value of goods based on the transaction price of goods of the same kind and quality that has previously been recognized as a dutiable value and satisfies certain requirements.

Third method

In case where neither of the first and second methods can be applied, the third method is used to determine the dutiable value of goods based on the transaction price of similar goods that has previously been deemed as a dutiable value and satisfies certain requirements.

Fourth method

In case where none of the first, second and third methods can be applied, the domestic sale price after import clearance minus certain costs, etc. is determined to be the dutiable value of the relevant goods.

Fifth method

In case where none of the first to fourth methods can be applied, the dutiable value of imported goods is determined based on the price obtained by calculating the costs incurred in the production of such goods based on the cost statement of the product presented by the manufacturer of the exporting country.

Sixth method

In case where none of the first to fifth methods can be applied, the dutiable value of goods is determined based on the reasonable standards which conform to the principles of the first to fifth methods.

Kinds of methods of determining the dutiable value

These methods must be applied sequentially starting with the first method, and any evaluation method of lower priority can be applied only when the dutiable value determined by the method of higher priority cannot be applied. However, the fifth method may be applied in advance of the fourth method in case where the person liable for duty payment makes a request for it.

Disapproval of dutiable value and submission of evidential data for the declared value

Overview

In case where a person liable for duty payment files a value declaration based on a transaction price and there are any causes making it difficult to recognize such declared value as the dutiable value, the head of the relevant customs office may request such person to submit data attesting that the relevant declared value corresponds to the fact.

Scope of disapproval of the dutiable value
  • In case where any dutiable value declared by any person liable for duty payment is substantially different from the dutiable value of the goods of the same kind and quality or the similar goods
  • In case where dutiable values declared by a person liable for duty payment have substantially fluctuated although such person has continued to import goods from the same supplier
  • In case where declared goods are crude oil, minerals, grains, etc., the international market prices of which are published, and the declared values are substantially different from their published international market prices
  • In case where there is a substantial difference between the previously declared value and the newly declared value after the relevant person liable for duty payment changes his/her customer
Determination (and notification) of dutiable value

In case where a person liable for duty payment fails to submit any related data or in case where it is difficult to recognize the declared value as the dutiable value, the head of the relevant customs office shall not apply the first method but determine the dutiable value by means of one of the second to sixth methods.

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