When you are importing goods into your country, you will have to declare the goods to customs and possibly pay duties. It may come as no surprise to you that, depending on which country you are importing your products from, you will pay different duties. So a toaster being imported from Canada into the Unites States will be treated differently than one being imported from China into the United States. If you live in North America, you probably know about NAFTA (a trade agreement which ensures most goods are duty free).
When I first started my career in importing and I learned about this I thought, Surely China must have a lot higher duty rate than other countries seeing as China is stealing jobs from all of us Westerners and governments typically want to encourage local manufacturing.
Most countries have three levels of duties for countries:
Most loved (or at least we signed a free trade agreement with you)
Most hated (think Axis of Evil)
Everyone else (ironically called most favored)
Harmonized Tariff Schedule for the U.S. with different rates listed
So if you’re like me and you want to start importing “Tileboard which has been continuously worked along any of its edges and is dedicated for use in the construction of walls” (seriously what is this?) you will pay anywhere from 0% to 45% depending on where it is coming from.
While classifying your goods can be tricky, knowing which duty rate applies to it is simple. The middle category, “special”, is reserved for countries that have special trade agreements with another country. So in this case, that would apply to countries like Canada (this tariff schedule is for the U.S.). The third column is reserved for the truly nasty of nasty countries which likely have severe trade sanctions on them. Think North Korea. There are only a very small handful of countries that this applies to and if you are new to importing and thinking about importing from these countries, all I can say is good luck to you!
The first column is the most interesting. This is ironically referred to as the “Most Favored Nation” category. (so what is a country like Canada? most-est favored nation??) Most countries, even if they have somewhat iffy relations with your home country, i.e. China, fall into this category. Generally, for a country to be removed from another country’s “Most Favored Nation” list is paramount to diplomatic war.
So a very long story short, China is considered a “Most Favored Nation” by most countries. So, if you’re importing “Tileboard which has been continuously worked along any of its edges and is dedicated for use in the construction of walls” and it has a density exceeding 0.8g/cm, refer to the first column. Therefore, you will actually pay 0% duty on it. However, if you’re importing that same product from North Korea, you will pay 30% duty on it and you may want to re-consider that trade-trip to Pyongyang.
Want to find out how to find products to import when you have no idea to start? Why should you NOT use Alibaba to look for Suppliers and where SHOULD you look?
Join the ChineseImporting.com course today
Like Us on Facebook for tips on finding great products to import (and tons more)