Purolator International TradeAssist Zone™
Calculating Duties and Taxes
Example of Import Duties Calculations as per Statistics Canada
The total import tax on an imported product includes all four items indicated above: import duty (DAI), consumption tax (SC), Law 6946 surcharge tax, and the sales tax (IV). Companies operating in the Free Trade Zones (FTZs) who process or manufacture goods to be exported to third markets receive 100% exemption from all types of import taxes and surcharges for the importing of raw materials, processed or semi-processed products, parts and components, inputs and other items necessary for the production and operation of the company. For more information please visit Foreign Affairs and International Trade Canada.
Import taxes or duties vary depending on the item imported. According to Foreign Affairs and International Trade Canada, specific percentages that each item pays are set forth in the Customs duties list. Costa Rica levies duties ad valorem on the cost, insurance and freight (CIF) value, ranging from 0%-15%, except for luxury products such as vehicles, alcoholic beverages, processed precious metals, and farm produce also produced in Costa Rica (40-70%). In addition to the import duty set forth in the Customs duty list (impuesto arancelario-DAI), the consumption tax (impuesto selectivo de consumo-SC), the 1% tax of Law 6946 and the sales tax (impuesto de ventas - IV) must be included in calculating the total import duties on a particular product.
Information on import duties on Canadian products covered by the Canada-Costa Rica Free Trade Agreement can be obtained at http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/costarica/index.aspx or by contacting the Tariffs and Market Access Division (EAT) of the Department of Foreign Affairs and International Trade.
CIF
All import duties are assessed on the CIF (Cost, Insurance & Freight) price of the product
Import Duties (DAI)
The import duties (Impuesto Arancelario- DAI.) are published in the customs duties regulations. The list is divided into categories of products and each product is in turn levied a particular percentage of import duty based upon the CIF price of that product. To arrive at the import duty multiply the CIF price x % import duty (DAI)
Formula: Import Tax = CIF x % DAI (Customs import tax)
Consumption Tax
The imported product may also be subject to the Consumption Tax (Impuesto Selectivo de Consumo -SC). The customs duties regulations will indicate the % consumption tax, ranging from 5 percent to 75 percent, applicable to each product. The highest taxed items are arms and munitions, jewellery, whiskey, new and used vehicles, and wine and beer. To calculate the consumption tax you start with the CIF price and add the import duty which was calculated above (DAI) and multiply it by the % of consumption tax (SC).
Formula: Consumption Tax = CIF + DAI x % consumption tax (SC)
Law No. 6946
Surcharge TaxLaw No. 6946 levies an additional 1% tax on the CIF Surcharge Tax price of most imported Law No. 6946 levies an additional 1% tax on the CIF price of most imported products, except for medicines and raw materials for human consumption and industry.
Formula: Law No. 6946 = CIF x 1% Surcharge Tax
Sales Tax (IV)
At the time of entry, the imported product is also subject to the sales tax (impuesto de ventas - IV) which is currently set at 13%. Certain basic products such as staple foods, school uniforms, etc. are exempted. To determine the sales tax to be paid you add all the prior taxes calculated and multiply it by the sales tax.
Formula: Sales Tax (IV) = CIF + DAI + consumption tax (SC) + Law 6946 x 13% sales tax (IV)
Special Import Regime