Resources/Import Regulation in Germany
Import Regulation and Customs, Tax and Duties in Germany

When exporting to Germany, various aspects are to be considered: Customs and taxes, quality and environmental standards, trademark and competition rules are just a few of them. It is within the responsibility of the importer to clear the items for circulation in Germany, exporters need to be informed on prerequisites of penetrating the German market, if only for pricing purposes. When it comes to customs duties for goods which are exported to Germany, their origin is of utmost importance.

Free circulation of goods in the Single European Market

Goods sold to Germany from a member state of the European Community are not subject to customs duties. They are free to circulate within the Single European Market, in which there is freedom of movements for goods and capital. The free circulation of goods in the Single European Market means that they can be imported without any customs clearance within the member states. This circulation of goods is inter-community supply and acquisition.

Non-EU countries

For goods originating from outside the Common Market, importing to Germany means crossing a EU border. Thus, the European Customs Tariff applies, since customs tariffs have been harmonized within the Union. Entering into the European Union, goods must be declared for customs clearance. Therefore, importers must address to the customs authority, usually by handing over shipping documents. In general, customs duties in Europe are calculated ad-valorem, meaning that they are derived from the value of the imported goods. This value – the customs value – is equivalent to the sales price; it is adjusted by adding the costs of transport, insurance, loading, and handling to the port of entry into the European Union in case they are not included in the sales prices (cif-price), which is to be proven by sales documents. Vice versa, expenses for the transportation within the European Union can be deducted if they have been included in the sales price beforehand, which must be documented, too.

European Customs Tariff

The European Customs Tariff (TARIC, Tariff intégré des Communautés européennes) applies for goods originating from outside the Single European Market, since customs tariffs have been harmonized within the Union. Goods must be declared for customs clearance, when they are brought to the European Union. Therefore, importers must address the customs authority, usually by handing over shipping documents.

In general, customs duties in Europe are calculated ad-valorem, meaning that they are derived from the value of the imported goods. This value – the customs value – is equivalent to the sales price; it is adjusted by adding the costs of transport, insurance and loading in case they are not included in the sales prices (cif-price), which is to be proven by sales documents.

Vice versa, costs of transportation within the Single European Market can be deducted, if they have been included in the sales price beforehand, which must be certificated, too.

Transit regulations

A transit procedure facilitates the customs-free transfer of imported goods to an interior customs post. Legally, the transit procedure is regulated by the Community transit procedure within the EU or the common transit procedure for the trade of goods between EU and EFTA countries. Other international procedures are also permitted (e.g. Carnet TIR for traffic).

Items which are only temporarily brought into the European Union and are generally exempted from customs duties intended to be re-exported without modification, e.g. exhibits for trade-fairs. Items are transferred to this procedure of temporary use, if their respective customs exemption or the application of a reduced customs rate depends on the non-Community goods being used under the supervision of the customs office.

General Preference System

The European Customs Tariff grants tariff exemptions or preferential treatments, depending on the imported item and its origin. Customs preferences result either as regional preferences from special agreements or are granted unilaterally to developing countries by the European Union in the framework of the General Preference System (GPS).

The GPS intends to support the development of certain areas and regions or to help easing a strong demand within the European Market. Tariffs may be suspended temporarily or for quotas of a certain amount.

Customs preferences

Disregarding the intended use of the merchandise, the European Customs Tariff grants tariff exemptions or preferential treatments, depending on the imported item and its origin. Customs preferences result either as regional preferences from special agreements or are granted unilaterally to developing countries by the European Union in the framework of the General Preference System (GPS). There is a vast catalogue of agreements on preferential treatment. These agreements are either meant to support the development of certain areas and regions or to help easing a strong demand within the European Market. In some cases, tariffs may be suspended temporarily or for quotas of a certain amount.

Tax and duties

All industrial imports are subject to an “Import sales tax” of 19%. It is equivalent to the value-added tax (VAT) which is levied on all domestically produced items, thus placing the same tax burden on imported and domestic products. The import turnover tax is charged on the duty paid value of the import article plus a customs duty. A discounted tax of 7% is levied on food products, books, newspapers, pieces of art etc.

Within the Single European Market, a community-wide system of VAT collection is in place. National VAT is levied on the product at the place of production. Buyers can deduct it as input tax in their home country, provided that the supplier has got a valid value added tax identification number. Customs duties as well as taxes are collected by the German customs authorities.