Can somebody please explain import tax?

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Forums › Finance and wealth management › Can somebody please explain import tax?

Finch

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#148642 25-Jun-2014 21:26

Hi guys.

I want to order something off Amazon. The total price is $404.52 (The item is $368.07) which includes shipping ($36.45). I have searched on the forums here and have seen a few threads, some older some newer but I am even more confused. I have read you don't need to pay anything for orders under $400, but then I have read I have to pay if my order is over $60!??

I put something into whatsmyduty.org and it said I will need to pay $120-$130 in tax? Is that for real or did I do something wrong?

I would say my order comes under the "toys" category (If that matters).

The order would be shipping directly from America-NZ, would the import tax be more/less if I used Youshop as the middle man?

Thanks for the help!

Xeon

302 posts

Ultimate Geek

#1074605 25-Jun-2014 21:42

If the duty and GST exceeds $60 then you will be charged for duty/GST/import fee otherwise they do not bother collecting. For items with no additional duty this means you only have to pay if your order (including shipping) exceeds $400 NZD. Import tax would not be less via youshop (unless youshop shipping is cheaper).

MikeB4

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#1074607 25-Jun-2014 21:42

Customs have an 0800 number, give them a call and get the correct answers from the horses mouth

Behodar

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#1074608 25-Jun-2014 21:43

You need to pay tax if the tax is over $60 - this means purchases over $400 if no specific duty is collected (60 / 0.15 = 400).

The entire purchase price is assessed, including delivery, so tax will be payable. At $404.52 you'll be paying just over $60 in GST, plus another $60 or so in import fees and other miscellaneous charges; that's where the $120-$130 comes from.

Edit: Two replies snuck in while I was typing :)

andrewNZ

2487 posts

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#1074610 25-Jun-2014 21:45

Two different taxes here

The $400 threshold is for GST only. Duty is different and extra.

Not every parcel is affected, they only check a certain number of parcels.

Xeon

302 posts

Ultimate Geek

#1074621 25-Jun-2014 21:50

andrewNZ: Two different taxes here

The $400 threshold is for GST only. Duty is different and extra.

Not every parcel is affected, they only check a certain number of parcels.

$400 threshold includes both GST and Duty, see here: http://www.whatsmyduty.org.nz/faq

alexx

867 posts

Ultimate Geek

#1074640 25-Jun-2014 22:09

You have to put all the pieces of the puzzle together.
If the item is a 'toy' it attracts 5% duty.
http://www.customs.govt.nz/news/resources/factsheets/Documents/Fact%20Sheet%2028.pdf

Then there is G.S.T. to add on top of the item which already has 5% duty... plus, if your item is over the threshold there is an Import Entry Transaction Fee.
http://www.whatsmyduty.org.nz/faq

Duty plus G.S.T. plus Import Entry Transaction Fee can quickly add up to a large number.

#include <standard.disclaimer>

Finch

2851 posts

Uber Geek

#1074658 25-Jun-2014 22:12

Thanks everyone for the replies.

I still don't understand it but after reading through the answers a few times hopefully I will understand it, don't worry its not you guys its me.

How do I know if the tax will be over $60?

Lets say I go through with the order, is there a chance I wont have to pay anything extra? IE if Customs or whoever don't check my parcel and just let it through? Or is everything checked and I will 100% have to pay?

Seems very steep to be paying $130 on top of something that costs $400 or is that just the norm? Puts me off majorly.

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MikeB4

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#1074675 25-Jun-2014 22:15

Put the purchase price and freight in the customs calculator and it will tell you the amount payable

Dratsab

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#1074678 25-Jun-2014 22:17

There's also a link at the bottom of the calculator which says "Breakdown of calculation" - have you tried clicking that? It gives a relatively comprehensive breakdown of why the duty calculation works out at what it does. Kinda like this:

Kyanar

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#1075020 26-Jun-2014 13:57

If you're ordering from Amazon, they usually pre-clear it with Customs and charge you the tax and duty at the time of purchase (the advantage is that if they undercalculate it, they pay the difference and if they overcalculate it they refund the difference). Check to ensure that Amazon hasn't already estimated tax on your order.

Bung

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#1075048 26-Jun-2014 14:44

You're so close to being under the $400 threshold do you have to buy now? Any chance that the price will drop in near future?