Meaning
Appraisal method used by tax authorities to determine the price of imported goods for the calculation of ad valorem duties. The customs transaction value is generally the price actually paid or payable for the merchandise when sold for export to the country of importation.
Valuation Component
Calculation of the total includes the costs of packing and royalties but excludes internal taxes if they are separately identified on the invoice. Proper disclosure defines the customs transaction value.
Documentation Audit
Verification of the declared amount requires a thorough review of the commercial invoices and the proof of payment provided by the importer. Customs officials examine the relationship between the buyer and the seller to ensure that the price has not been influenced by a common ownership structure before accepting the customs transaction value. This scrutiny protects the revenue of the state and ensures fair competition for local producers.
Evidence supports the claim.
Valuation Boundary
Rejection of the primary method occurs if the sale is subject to conditions that make the price impossible to determine accurately. In such instances, authorities use alternative methods such as the value of identical or similar goods produced in the same region to find a proxy for the customs transaction value.
