Estimations, Why are they so important?
Before importing any cargo to Iran, the most outstanding question for the importer, and in the mean time the most difficult to solve, is to find out how much the whole operation will cost to do.
Estimations, Why are they so important?
Before importing any cargo to Iran, the most outstanding question for the importer, and in the mean time the most difficult to solve, is to find out how much the whole operation will cost to do. You need to calculate transportation, handling and customs clearance charges, until the product is in the hands of final user in Iran.
No one can say how much all of these charges are exactly going to be, but we offer "Estimations" to our customers, and by experience our estimations are most of the time quite close to real.
The reason that customer's can't have a proper evaluation of costs before the imports begin are some of below items:
A. HS code issues:
1. The tariff duty payment depends of HS code of cargo, but you can't make sure that Iranian customs office will accept the HS code offered from your side! It means you may simply consider an HS code for your cargo which is levied 4% in Iranian customs, while the customs inspector will offer another HS code which is tariffed above 30% according to his discretion. So, no one knows for certain what will happen when the inspector checks the cargo.
2. There might be some HS code defined in Iranian customs with a very low Tariff payment suiting your cargo that you might be totally unaware of. This way you may end up paying above 40% of the total cargo value, while in fact you should have paid only 4%! (and visa versa)
B. Value Issues:
1. Importers usually tend to under-state the value of their cargo in order to pay less tariff and tax. To counter this, the customs has established its own "Value Department". This department uses (a) Web service to find out the precise international market value of each product (b) The past record for any item imported before, and obviously the price shouldn't be less than the highest previous imports of the same item in customs records. This situation makes the value issue almost unpredictable. The customs only validates the Performa invoices that are of high enough price to convince them it is a real price stated. This is one of the most frequent reasons the importer has no idea the tariff and taxes will be levied on how much a value?! And another good reason to use our estimation service and our expertise to find out what will happen to the value of your cargo in the Value Department.
2. In some cases customs will consider a very high price which is really much higher than the real value of your cargo, while you don't expect. If they put a value 5 times higher than your real purchasing value, and suppose if the Tariff is 12% and VAT tax 8% (total 20%), instead of paying 20% of real price, you will have to pay 100% of the real price, because customs won't accept that the product is much cheaper than they expected.
For many products imported to Iran, customs require permits to be received from authorities and ministries inside Iran. Let alone the very long time consumed and amount of lobbying needed to get these permits, usually there are a lot of charges involved before you can get them. These permit charges are generally overlooked by customer during calculations of the imports charges, while they exist and sometimes are considerably high. The most important of these permits that your may or may not be entitled to show them are as follows:
1. Iranian Standard- This one which is necessary by law for many products (from auto-parts, to house appliances, chemicals... etc) should be received from Iranian Standard Organization and in most cases include the tests taken in laboratories. The Standard Organization will send a sample of cargo to a university in some remote part of country and they will have to return the test results within a month (usually more!). So your customs clearance agent in Iran has to take care of whole this lengthy operation, or else the whole imports procedure may prove to be a total loss.
2. Medical Equipment- Almost all medical and health products including drugs and cosmetics are obliged to have the license issued by the Medical Equipment department and/or Ministry of Health, before they arrive. In most cases it is almost impossible to receive these permits after the cargo was arrived without having one!
3. Telecommunications Permit- All phone sets, mobile phones, cell phones, tablets with SIM card, routers, modems, network switches and virtually everything that might be somehow relevant to telecommunications industry must be checked by a special inspector, which in most cases will lead to taking a sample for testing at different authorities designated for this purpose.
The above are three of the permits most encountered by importers but there are many other which might be requested by customs for specific products.