Customs Treatment of Related Fees: Tax Planning Under WTO

July 02, 2003 | BY

clpstaff &clp articles

Customs compliance and tax planning for cross-border transactions are becoming more important and complex. Payments between different links in a cross-border supply chain must be structured carefully to avoid high customs value and possible double taxation.

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By Neal Stender & Wang Dong, Coudert Brothers, Hong Kong and Beijing

The newly issued PRC General Administration of Customs Procedures Concerning Imported Goods Royalty Valuation (the Royalty Procedures, effective July 1 2003) are the most recent in a series of regulatory changes that aim to bring PRC law into closer conformity with WTO requirements.1 The Royalty Procedures provide important details on implementation of the previously issued PRC General Administration of Customs Procedures Regarding Determination of Customs Value of Imported and Exported Goods (the Value Procedures, effective January 1 2002).