Import and export and VAT - Import of goods

Service-Tax

Import of goods - definition

Pursuant to Art. 2 point 7 of the VAT Act, the import of goods should be understood as the import of goods from the territory of a third country into the territory of the European Union. By third country, we mean countries outside the EU, such as Russia or the United States. This is a new definition that entered into force on April 1, 2013. The current part of the cycle will be devoted to this subject.

Tax obligation on import of goods

According to Art. 19 paragraph 7 of the VAT Act, the tax obligation in the case of import of goods arises when a customs debt arises. However, there are two exceptions to this rule, as outlined below.

In the case of placing goods under the customs procedure: inward processing under the drawback system, temporary clearance with partial relief from import duties, processing under customs control - the tax obligation for the import of goods arises when the goods are placed under this procedure.

On the other hand, when the import of goods is covered by the customs procedure of: customs warehouse, temporary admission with full exemption from import duties, inward processing under the suspension system, transit, and these goods are subject to levies or similar charges and no customs debt is incurred at the same time - the tax obligation arises upon the maturity of these fees.

Place of taxation of the importation of goods

The scope of the place of taxation in the case of import of goods is specified in the newly added art. 26a of the Act, from which it follows that the place of taxation of the import of goods, as a rule, is the territory of the Member State where the goods are located at the time of their introduction into the territory of the European Union.

If the goods are placed, at the time of their entry into the territory of the European Union, one of the following customs procedures or destinations:

  • inward processing procedure in the suspension system,
  • the temporary admission procedure with total relief from import duties,
  • the customs warehousing procedure,
  • transit procedure, including temporary storage, prior to dispatching a customs-approved treatment or use,
  • intended use - entering goods into a free zone or free warehouse

- the place of importation of such goods is the territory of the Member State where the goods will cease to be subject to these procedures and destinations.

The tax base

As a rule, the taxable amount for importing goods, in accordance with the VAT Act, is:

  • customs value plus the duty payable,
  • customs value plus due duty and excise duty, if the subject of import are goods subject to excise duty.

The Act also provides for a specific determination of the tax base, this applies, inter alia, to import of goods placed under the outward processing procedure, or import of goods placed under the temporary admission procedure.

In the case of goods placed under the outward processing procedure, the taxable amount is the difference between the customs value of the compensating or replacement products released for free circulation and the value of the temporarily exported goods, plus the duty due. If the subject of import under outward processing are goods subject to excise duty, the taxable amount is the difference between the customs value of the compensating or replacement products released for free circulation and the value of the goods temporarily exported, plus the duty and excise duty due.

On the other hand, the taxable amount in the import of goods subject to the temporary admission procedure with partial relief from import duties and the processing under customs control is the customs value increased by the duty that would be due if the goods were placed under the release for free circulation procedure. Where goods subject to excise duty are imported under the temporary admission procedure with partial relief from import duties or for processing under customs control, the taxable amount shall be the customs value plus the duty that would be payable if the goods were to be released for free circulation, and about the excise tax.

It is worth emphasizing that pursuant to Art. 29 sec. 15 of the Act, the tax base includes (unless such elements have been included in it):

  • commission,
  • packaging,
  • transport, and
  • insurance costs already incurred or to be incurred up to the first destination within the territory of the country.

The above elements are included in the tax base, also when they arise in connection with transport to another destination within the territory of the European Union, if that place is known at the time of importation.

Important! The first place of destination means the place mentioned in the transport document or other document on the basis of which the goods are imported.

It is possible to add to the tax base the fees and other charges specified in separate regulations, if the customs authorities are required to collect these charges for the import of goods.

Services directly related to the import of goods

The issue of taxation of services directly related to the import of goods is regulated by Art. 83 sec. 1 point 20 of the VAT Act. It shows that the 0% VAT rate applies to services directly related to the import of goods, where the value of these services has been included in the tax base, in accordance with Art. 29 sec. 15, with the exception of services:

  • in the field of insurance of goods,
  • for the import of tax-exempt goods.

VAT on the import of goods

According to Art. 86 sec. 1 to the extent that the goods and services are used to perform taxable activities, the taxpayer has the right to reduce the amount of tax due by the amount of the input tax.

The amount of input VAT in the case of import of goods is the sum of the tax amounts resulting from the customs document and the import declaration. A very important exception is the fact that the amount of input tax is also the amount of tax due on the import of goods - in the cases referred to in art. 33a of the Act.

Simplified procedure for the import of goods governed by Art. 33a of the VAT Act

In this case, the taxpayer may deduct input VAT in the settlement for the period in which the tax obligation arose in the tax due on the import of goods or in the settlement for one of the next two accounting periods. It is also possible that the taxpayer will lower the VAT amount shown in the customs declaration and settle it in the tax declaration, in accordance with art. 33a of the VAT Act. In such cases, the customs authorities issue appropriate decisions, and the taxpayer is obliged to pay the difference in VAT within 10 days from the date of delivery of these decisions. The VAT amount resulting from such a decision, the taxpayer in accordance with art. 86 sec. 10 point 6 of the Act, may be deducted in the settlement for the accounting period in which the decision was received or in the settlement for one of the next two accounting periods. This settlement can only be made if the taxpayer pays the tax resulting from the decision.

The import of goods is regulated by Art. 33b of the VAT Act

In the case of the use by the taxpayer of a single permit referred to in article 2. 1 point 13, first and second indents of Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code, the taxpayer is obliged to calculate and prove the amount of tax due for the import of goods in the declaration for the import of goods in the import declaration.

It should be submitted to the head of the customs office by the 16th day of the month following the month in which the tax obligation for the import of goods arose, but not later than before submitting the tax declaration. If the goods should be presented or made available for inspection only at one customs office, the taxpayer may submit a collective import declaration for a monthly period.

Within the above deadline, the taxpayer must also pay the amount of tax indicated in the declaration.