Types of Tariffs
A tariff may be one of the following four kinds:

(1) Ad valorem   (2) Specific   (3) Alternative
(4) Compound

1. Ad Valorem duty
The kind most commonly used, is one that is calculated as a percentage of the value of the imported goods - for example, 10, 25 or 35 per cent.

This may be based, depending on the country, either on destination (c.i.f.), or on the value of the goods at the port in the country of origin (f.o.b.).

2. A Specific duty
Is a tax of so much local currency per unit of the goods imported (based on weight, number, length, volume or other unit of measurement. Specific duties are often levied on foodstuffs and raw materials.

3. An Alternative duty
Is where both an Ad valorem duty and A Specific duty are prescribed for a product, with the requirement that the more onerous one shall be Ad valorem duty value plus 10 cents per kilo.

4. Compound duties
Are imposed on manufactured goods that contain raw materials that are themselves subject to import duty. The "specific" part of the compound duty (called compensatory duty) is levied as protection for the local raw material industry.

Dutiable Weights

Depending on the country, the Dutiable weights used to calculate specific import duties may be the gross weight, the legal weight, or the net weight.

The dutiable weight is the actual weight upon which duty must be paid.

The gross weight is the weight of the goods and all interior, exterior containers and packing material.

The legal weight (used mainly by Latin American countries) is the weight of the goods and of the immediate interior containers.

The net weight is the weight of the goods without the packing materials.
However, in a few countries, it is defined as including the weight of the immediate container.

Very often, there is a fixed percentage allowance (called the tare) used by the customs authorities for determining gross weight from net weight, and vice-versa. Most countries using specific duties employ different types of dutiable weights for difference commodities.

It is essential for an exporter to know what dutiable weight is being used for its product as it may be able to vary its packing accordingly.

In some countries (such as Switzerland, Venezuela and Colombia) most specific duties are levied on gross weight, whatever the nature of the goods.

Next Page 2.2/8 - About Tariff Lists, Dutiable Value and Anti Dumping Duties "Anti-dumping are additional duties to match the difference between prices..."

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