Shipping and customs--how to optimize as a seller?

gostang9 · Jan 2, 2019

jaspers
Thanks for going all this length with us! I guess you would be correct in the case of new watches. For second-hand or otherwise vintage I'm not sure. Consider an Ed White as an example: had I bought one in a previous life in 1965, I would have to pay sales tax and no additional import charges under the current EU tax harmonization in the EU. However, an Ed White maden its way to the US, changed owners a couple of times, and then would be purchased by me in 2019, living in the EU. Even though this watch was produced in CH, I would still have to pay sales tax and import duty, correct? I should have paid more attention in tax law class...

An Ed White manufactured in Switzerland will fall under COO of CH regardless of when or by whom it was purchased.

1. Import Duty owed will be dependent on the 4 items I listed in several posts above. The one additional caveat is that for some goods a Customs Officer may require a Certificate of Origin to prove the COO. However, for watches this is one of the reasons they are clearly marked on the dial as "Swiss Made". As long as the Customs Officer accepts the watch as legitimate (not a 'fake' as that would be an entirely different story) they will accept the "Swiss Made" marking as proof of COO.

2. Taxes are normally considered transactional and the rules vary by country, the product and the type of transaction:
- sometimes a tax is owed for purchase of a new item and not for a used item
--> we used to have an 7% GST and 8% PST
--->> the 7% went to Federal government for both new and used cars, while the 8% went to the Province for new cars only and not for used cars
--->>> then the GST and PST were combined under a new 13% HST 'Harmonized Sales Tax' which was charged on both new and used cars
- sometimes the tax is owed for purchase whether new or old
- sometimes the tax is owed depending on where it is purchased (applicable if bought from a dealer, not if private)
- sometimes the tax is owed depending on who is purchasing (ie: VAT can be returned or avoided if buyer is leaving the country after purchasing)

My descriptions of taxes don't answer your question, I simply share to show that taxes are complicated and very dependent on the country/province/state you live in and the type of 'transaction' you're making.

Fun stuff... plenty of government personnel, lawyers, accountants and logistics experts make a living on these very topics... 😉

momosono · Jan 2, 2019

Archer
Swiss COO are duty free to the EU, it won't matter if you buy it from a seller anywhere else in the world, the duty should be 0.

Unfortunately that goes only for new products having been shipped/exported for the first time by the manufacturer or his representative.
And as you correctly say taxes are another thing (VAT also known as sales tax in the USA are levied no matter where an object - or service - comes from)
Anyway, in Europe duties are usually less than VAT which in some European countries is 20% or even higher (Denmark 25%, Netherlands and Belgium 21%, France 20% etc)

gostang9 · Jan 2, 2019

momosono
Unfortunately that goes only for new products having been shipped/exported for the first time by the manufacturer or his representative.

Why do you say that? Duty is based on COO (Country of Origin), and that never changes...

gostang9 · Jan 2, 2019

momosono
And as you correctly say taxes are another thing (VAT also known as sales tax in the USA are levied no matter where an object - or service - comes from)
Anyway, in Europe duties are usually less than VAT which in some European countries is 20% or even higher (Denmark 25%, Netherlands and Belgium 21%, France 20% etc)

I think this gets to the heart of the usual question or issue. People have to pay some amount at the time they import a watch across borders (the 'transaction' point) and so they see the amount paid as related to customs duties / tariffs. However, the reason for the charge is possibly related more to the sales tax or VAT.

Tax usually > duty/tariff --> Both charged on the declared value and vary based on transaction details.

Dan S · Jan 2, 2019

Coming into the US from Europe, the duty appears to depend on various details besides simply the total declared value, including the technical details of the watch (e.g. auto- vs manual-winding), the case material, and the fractional values of the movement/case/bracelet. Some details about this were posted earlier in the thread. On some occasions, the seller or the courier service has provided all of these details, and when they do so, the duty seems to fairly modest (or that could just be coincidence). FedEx once called me to ask a bunch of these questions. On other occasions, I have paid exorbitant customs duty after the fact, and I have no idea why. It always seems like a crapshoot to me. When European shippers send watches to the US, do they fill out a complicated form that provides all of these details?

I have sent watches to Europe a few times, and the form I fill out is very simple and basic; I see no way to indicate the case material, the separate values of movement and case, etc. If I recall correctly, it just asks for a value and a description. Maybe these details don't matter in Europe?

Archer · Jan 2, 2019

Dan S
Coming into the US from Europe, the duty appears to depend on various details besides simply the total declared value, including the technical details of the watch (e.g. auto- vs manual-winding), the case material, and the fractional values of the movement/case/bracelet. Some details about this were posted earlier in the thread. On some occasions, the seller or the courier service has provided all of these details, and when they do so, the duty seems to fairly modest (or that could just be coincidence). FedEx once called me to ask a bunch of these questions. On other occasions, I have paid exorbitant customs duty after the fact, and I have no idea why. It always seems like a crapshoot to me. When European shippers send watches to the US, do they fill out a complicated form that provides all of these details?

I have sent watches to Europe a few times, and the form I fill out is very simple and basic; I see no way to indicate the case material, the separate values of movement and case, etc. If I recall correctly, it just asks for a value and a description. Maybe these details don't matter in Europe?

For shipping into the US by FedEx, you need to fill out a watch sheet like this one (or the recipient needs to fill it out - I always send it as the shipper):

Each country has their own ways of determining how duty or taxes is applied to each specific watch, so I would not expect this to apply to every country.

Cheers, Al

jaspers · Jan 2, 2019

gostang9
I think this gets to the heart of the usual question or issue. People have to pay some amount at the time they import a watch across borders (the 'transaction' point) and so they see the amount paid as related to customs duties / tariffs. However, the reason for the charge is possibly related more to the sales tax or VAT.

Tax usually > duty/tariff --> Both charged on the declared value and vary based on transaction details.

Again, really helpful. Thanks a bunch for this. I see now how the VAT outweighs duties, but is generally perceived as an import tax.

jaspers · Jan 2, 2019

Dan S
FedEx once called me to ask a bunch of these questions. On other occasions, I have paid exorbitant customs duty after the fact, and I have no idea why. It always seems like a crapshoot to me. When European shippers send watches to the US, do they fill out a complicated form that provides all of these details?

My thoughts exactly! I'll be shipping a watch off to Canada tomorrow, will let you know what customs forms I had to fill in.

Shipping and customs--how to optimize as a seller?

gostang9

momosono

gostang9

gostang9

Dan S

Archer

jaspers

jaspers

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