Advanced

IMPORTATION VALUE FOR VAT PURPOSES IN THE EU

Al-Sammarraee, Hareth LU (2011) HARM53 20111
Department of Business Law
Abstract
The precise valuation and correct assessment of the value of imported goods should be preceded by determining the value of imported goods for Customs purposes.
The provisions regulating the Customs valuation are overlapped and complicated; the reason which prompted the Author, through this paper, to eliminate this overlaps and simplify the complexity, using a new approach represented by reclassifying and unifying its elements under new unified terminologies.
There are six methods, in a hierarchy order, to determine the Customs value; the principal method is the TV method, which is the price actually paid or payable for the goods when they sold for export to the EC Customs Territory, the price mentioned in the sale invoice is not,... (More)
The precise valuation and correct assessment of the value of imported goods should be preceded by determining the value of imported goods for Customs purposes.
The provisions regulating the Customs valuation are overlapped and complicated; the reason which prompted the Author, through this paper, to eliminate this overlaps and simplify the complexity, using a new approach represented by reclassifying and unifying its elements under new unified terminologies.
There are six methods, in a hierarchy order, to determine the Customs value; the principal method is the TV method, which is the price actually paid or payable for the goods when they sold for export to the EC Customs Territory, the price mentioned in the sale invoice is not, absolutely, the TV; there are some elements should be added or excluded from the price when they meet some conditions, and it could be rejected; then a subsidiary Customs valuation methods would apply.
The VAT value is differs from the Customs value, this dissimilarity is represented by the difference in the scope of VAT, the territory of VAT, inclusion of charges and duties to the VAT value, incidental expenses, etc.
There is a big risk that this difference is abused by fraudulent importers.
Moreover; VAT system has special rules concerning the importation such as; chargeability of VAT, discount and early payment, exemption, etc.
The declared value of the imported goods is a necessary basis for identifying the taxable base, which is very decisive to impose the VAT or the Customs duty.
The value declaration has exploited by ill-intentioned importer through fraud in declaring the value of imported goods to get some financial or tax advantages; this fraud can take place by undervaluation or overvaluation the declared value of imported goods.
The techniques used by fraudulent are varied and complicated; that’s why combating the fraud is at a high degree of difficulty, especially in case of importation from developing countries; that due to the big gap between the EU sophisticated Customs system and the elementary Customs systems in developing countries, in addition to the informality that overwhelming the trade sector in the developing countries. (Less)
Please use this url to cite or link to this publication:
author
Al-Sammarraee, Hareth LU
supervisor
organization
course
HARM53 20111
year
type
H1 - Master's Degree (One Year)
subject
keywords
TAXATION, TAX LAW, INDIRECT TAXATION, VAT, CUSTOMS
language
English
id
1975734
date added to LUP
2011-06-29 14:21:56
date last changed
2011-06-29 14:21:56
@misc{1975734,
  abstract     = {The precise valuation and correct assessment of the value of imported goods should be preceded by determining the value of imported goods for Customs purposes.
The provisions regulating the Customs valuation are overlapped and complicated; the reason which prompted the Author, through this paper, to eliminate this overlaps and simplify the complexity, using a new approach represented by reclassifying and unifying its elements under new unified terminologies.
There are six methods, in a hierarchy order, to determine the Customs value; the principal method is the TV method, which is the price actually paid or payable for the goods when they sold for export to the EC Customs Territory, the price mentioned in the sale invoice is not, absolutely, the TV; there are some elements should be added or excluded from the price when they meet some conditions, and it could be rejected; then a subsidiary Customs valuation methods would apply.
The VAT value is differs from the Customs value, this dissimilarity is represented by the difference in the scope of VAT, the territory of VAT, inclusion of charges and duties to the VAT value, incidental expenses, etc. 
There is a big risk that this difference is abused by fraudulent importers.
Moreover; VAT system has special rules concerning the importation such as; chargeability of VAT, discount and early payment, exemption, etc.
The declared value of the imported goods is a necessary basis for identifying the taxable base, which is very decisive to impose the VAT or the Customs duty.
The value declaration has exploited by ill-intentioned importer through fraud in declaring the value of imported goods to get some financial or tax advantages; this fraud can take place by undervaluation or overvaluation the declared value of imported goods. 
The techniques used by fraudulent are varied and complicated; that’s why combating the fraud is at a high degree of difficulty, especially in case of importation from developing countries; that due to the big gap between the EU sophisticated Customs system and the elementary Customs systems in developing countries, in addition to the informality that overwhelming the trade sector in the developing countries.},
  author       = {Al-Sammarraee, Hareth},
  keyword      = {TAXATION,TAX LAW,INDIRECT TAXATION,VAT,CUSTOMS},
  language     = {eng},
  note         = {Student Paper},
  title        = {IMPORTATION VALUE FOR VAT PURPOSES IN THE EU},
  year         = {2011},
}