One of the most frustrating aspects of buying from China is the uncertainty of duty and clearance costs.
Who must pay these costs? We discussed this in this blog too.
Follow this link: Who pays for custom clearance?
Now Lightinthebox and Miniinthebox offer an elegant way to solve this discussion!
What are these Custom Duty, sales taxes and Clearance costs?
In all the countries I know there is some kind of sales tax. On all the products you buy in this country, some percentage of the sales price will go to the government. No matter if you like this or not. In Europe the sales taxes are around 20 percent.
When you import a product yourself, these taxes are levied when the product enters your countries borders. Most of the times there is some free amount that you are allowed to import (In Europe €22, around $24). If the total value is above this amount your customs will levy the sales taxes.
Above the sales taxes are duty costs. These costs are levies by countries to protect their own market. They don’t want to be flooded by cheap products… So on all products there is some kind of percentage for duty costs. This is often above a certain amount (In Europe €150, around $170). The percentage is unclear. This depends on the kind of products you order.
Third are the clearance costs. These costs are levied by you postal office or company. To handle all the inconveniences of these taxes, they add another 10 to 15 bucks. This is called service L.
To know what the costs are in your country, please refer to your countries customs or check a site as DutyCalculator.com (I’ve no connections with this site, just an example).
Why must YOU pay these costs?
These costs are levied in YOUR country. That’s why you must pay them.
Most Chinese stores have a disclaimer that you cannot hold them for these costs.
It’s just a gamble.
You never know whether your parcel will be checked by your customs. There is so many parcel traffic, they cannot check all the packages. Sometimes your package will enter your country with no problem, sometimes you must pay the bill.
And you can imagine this is a real dumper. Having bought a great product, for a great price… And then paying an extra 20%, 30% maybe 40% at your doorstep.
There are many ways to avoid these costs. In my course I cover a whole training session on this subject alone.
Lightinthebox and MiniInTheBox came with a solution
This week I was ordering some products at MiniInTheBox (the little brother of Lightinthebox). These companies used to have a disclaimer, saying you must pay for the clearance costs and taxes.
But now they have a new elegant solution!
When you are at the check out page, you will find a check box to get insurance for the duty and taxes. This is their offer:
If you buy Duty & Tax Insurance and your package is charged additional duties and taxes upon delivery, please contact our Customer Service and we will compensate the duty and tax you have paid
The extra amount is around 4% of the total price. Lightinthebox must have calculated that most parcel will not be charged at the borders, and with this insurance fee they can cover the parcels that are charged.
For me this is a great solution. The uncertainty that I must pay another 50 to 60 bucks on a $200 order was a reason not to order some products. If I can have a guarantee that my order will be no more than $208 (total value + 4% insurance). This will be a no brainer for me.
So, hat off to Lightinthebox and MiniIntheBox to come with this solution!
Disclaimer: I haven’t tested it yet, and I don’t know how fast Lightinthebox or Miniinthebox will send you your money back in case this happens. Second maybe there are other Chinese stores too, that offer this service, but I haven’t seen it yet.
My Question for you
Have you ever dealt with customs duty yourself
and would you welcome a service like this for your future purchases?
Please write you comment down in the comment box below.
Wishing you safe purchases!
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