Landed cost calculator
Price is not cost. This builds the invoice value up through origin charges, freight, insurance, the customs value, duty, import tax and destination charges, and divides the result back down to a cost per unit you can quote against.
Inputs
Landed cost build up
Excise, anti dumping duty, countervailing duty, merchandise processing and harbour maintenance fees, and any tariff rate quota are not modelled here. Confirm the assessable value and the applicable rates with a licensed customs broker before you commit to a price.
The customs value is not the invoice value
Most customs unions, including the European Union, the United Kingdom, Canada and the great majority of WTO members, assess ad valorem duty on the CIF value: the transaction value plus international freight plus insurance to the point of entry. The United States is the significant exception and assesses on the FOB transaction value, which excludes international freight and insurance. On a shipment where freight is 20 per cent of goods value, that choice changes the duty bill by a fifth.
Import VAT or GST is usually assessed on a wider base again: CIF plus duty, and in some systems plus destination handling up to the first place of delivery. This tool uses CIF plus duty, which is the standard treatment in the EU and the UK.
What this deliberately does not model
Anti dumping and countervailing duties are assessed per origin and per exporter, sometimes at rates several times the ordinary tariff, and are the single largest source of unexpected import cost in metals, chemicals and processed agricultural goods. Check the destination trade remedy register against your specific supplier, not just the country.
Also outside this calculation: excise on alcohol, tobacco and energy products; tariff rate quotas where a lower rate applies only up to a volume; the US merchandise processing and harbour maintenance fees; quarantine and inspection charges; demurrage and detention once free time runs out. Demurrage in particular has ended more import margins than any tariff.
Reading the uplift figure
The uplift is the total landed cost as a percentage above the invoice value. For a containerised commodity moving on a normal trade lane at an ordinary tariff, 15 to 30 per cent is a common range. Above that, one of three things is usually true: the freight is out of line for the lane, the tariff line is wrong and a lower heading or a preference applies, or the destination charges include something that should have been negotiated into the freight rate.
Questions
Is duty calculated on CIF or FOB?
CIF in most of the world, including the EU, the UK and Canada. FOB in the United States. The selector at the top of the calculator switches between the two.
Is import VAT part of my cost?
For a VAT registered importer it is usually recoverable, so it is a cash flow cost rather than a margin cost. For an unregistered importer, or where the goods are used for exempt supplies, it is a real cost. It is included in the total here either way.
What is a normal landed cost uplift on a commodity import?
Fifteen to thirty per cent over invoice value is typical for a containerised shipment on an ordinary tariff. Bulk shipments on low tariff lines run lower, high tariff or air freighted goods run considerably higher.
Does this include anti dumping duty?
No. Anti dumping and countervailing duties are exporter specific and can exceed the ordinary tariff several times over. Check the destination trade remedy register for your specific supplier before you price.
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