World Trade Organization Organisation Mondiale du Commerce Organización Mundial del Comercio

Landing charges are assessed on all imports.

US FQ 17:

(on US 38)

Report by the Secretariat (WT/TPR/S/249):III. TRADE POLICIES AND PRACTICES BY MEASURE: (2) Measures Directly Affecting Imports:(ii) Customs valuation and clearance: Page 40, paragraph 22:

The report states that the Central Board of Excise Customs can fix "tariff values" (reference prices) for any type of imported good. The Secretariat report notes that India uses reference prices to calculate customs duties for imports of palm oils, crude soybean oils, poppy seeds, and brass strap. The report also notes that reference prices for edible oils have remained unchanged since 2006. Why are these particular products subjected to reference prices? How are these reference prices calculated? Please provide further details on the background and data source used to establish reference prices. Please explain the use of reference prices in light of Article 7 of the CVA.

Reply: Tariff values have been notified for palm oils, crude soybean oil, poppy seeds and brass scrap, as these goods are prone to undervaluation. Tariff values are fixed on the basis of prevailing international prices of these goods as observed from the various reputed international journals and other publications.

The tariff values are neither arbitrary or fictitious values nor minimum customs values. These values are floating values and are frequently reviewed and revised. As the tariff values on identified goods are computed based on the prevailing international prices, that is to say, the prices at which these goods are sold or offered for sale in the ordinary course of international trade under fully competitive conditions, such values are not inconsistent with Article VII of the GATT 1994 read with the CVA.

The tariff value system promotes greater uniformity and certainty in assessment practice. It checks undervaluation and thus acts as an important policy instrument for collection of appropriate amount of customs duty.

U.S. Follow-Up Question: Please specify the international journals and publications from which the tariff values are derived. How does India use this information to calculate the tariff value? Is India's policy to reject the transaction value where it is less than the tariff value? Does India consider requesting further documentation before imposing the set tariff value?

Reply: Tariff values are computed based on sources such as London Metal Exchange Price, Public Ledger etc. As already mentioned, tariff value is not minimum value. Hence, the value for computation of duty in case of commodities where tariff value has been notified, is the said tariff value and not the declared value irrespective of the fact that the declared value is higher or lower than the tariff value.