Your Partner
in Legal Success
| Reading Time: 5 Minutes
What is Customs Duty?
As a word meaning, “tax charged on goods entering or leaving a country” defines customs. In accordance with the legislation in our country, although we cannot talk about a single customs tax as a concept because more than one tax and duty is charged for goods coming to Turkey, the concept of “Customs Duties” is defined in paragraph 8/a of Article 3 of the Customs Law No. 4458. Accordingly, customs duties are defined as “all of the import or export duties applied to the goods“.
In Article 3, Paragraph 9 of the Law, import duties are defined as taxes and other financial burdens to be charged on import, including customs duties to be paid on the import of goods and other taxes and financial burdens with equivalent effect within the framework of agricultural policy or special regulations applied to certain products obtained as a result of the processing of agricultural products.
In Paragraph 10 of the same article, export duties are defined as taxes and other financial burdens to be collected on export, including customs duties to be paid on the export of goods and other taxes with equivalent effect and their financial burdens, within the framework of agricultural policy or special regulations apply to some products obtained as a result of the processing of agricultural products.
The Law’s definitions clarify that customs taxes refer to a broad range of taxes levied on goods crossing Turkey’s political borders, airspace, territorial waters, and inland waters, both on import and export, subject to the Turkish Customs Legislation.
Related Article: Bringing Export Prices to Turkey and The Related Sanctions.
What is Customs Duty in General?
Although customs duties are primarily regulated in Customs Law No. 4458, it is possible to see the provisions regarding these taxes in the Anti-Smuggling Law No. 5607, the Decision of the Council of Ministers No. 2009/15481 on the Implementation of Some Articles of the Customs Law No. 4458 and the Customs Regulations issued by the Ministry of Customs and Trade.
What is The Subject of Customs Duty?
Under Article 1 of the Customs Law, the tax subject is stated as “… Goods and vehicles entering and leaving the Customs Territory of the Republic of Turkey…“. Accordingly, the subject of customs duty is movable goods subject to import or export, and immovables or services are not subject to customs duties.
What is The Event That Creates The Customs Duty?
Under Article 181 of the Customs Law, customs liability in imports starts on the registration date of the customs declaration to be filed for the release of goods subject to import duties for free circulation or the temporary importation of goods subject to import duties with partial exemption from import duties.
Entering into free circulation is the most common occurrence of customs duty, as it means the importation of goods and the free purchase, sale, or use of the goods in circulation within the country. In customs duty, tax may arise with the registration of the import declaration, and customs duty will arise when the person declares the goods they brought with them while coming to the country.
What Does “Liability” Mean in Customs Taxes?
Although the title of the obligor is used instead of the taxpayer in the Customs Law, in the 11th paragraph of Article 3 of the Law, the concept of “Customs Obligor” is defined as all persons responsible for fulfilling the customs obligations. Article 181 of the Law states that the obligator is the declarant in import customs liability. In the case of indirect representation, the person on whose behalf the customs declaration is made will also be liable.
How is The Tax Base Calculated in Customs Duty?
The Customs Law uses the term “value” instead of “base“, which is used in the Tax Procedure Law. The value of goods is determined based on their sales price, and customs taxes are calculated using this value. According to Article 24 of the Law, the sales value of imported goods is defined as the actual price paid or to be paid, with adjustments made according to Articles 27 and 28 of the Customs Law for goods exported to Turkey.
How is The Taxation Process in Customs Duty?
In the 20th article of the Tax Procedure Law, the assessment is defined as the tax receivable being calculated by the tax office over the base and proportions indicated in the laws and determining this receivable in terms of amount. Since the assessment is an administrative action, it must only be made by the authorized tax office.
However, there is no provision in the Customs Law on how and by whom the assessment process will be carried out. However, during import transactions, the calculation made in line with the declaration given by the taxpayer is considered an assessment process; in other words, the accrual process replaces the assessment process.
Customs tax rates are determined by the Import Regime Decision by the Council of Ministers, based on the authority given by Law No. 474 on the Customs Entry Tariff Chart. The tariff schedule has been determined regularly according to the imported goods’ name, type, type, and characteristics. It has been arranged according to the characteristics of almost all the goods, including the customs tariff and statistical position number and tax rate, and according to the countries from which the goods are imported.
Accordingly, customs duty can be calculated by knowing the value of an item and its place on the schedule in the tariff.
What Are The Penalties Specified in the Customs Law?
Tax misdemeanors, in general, may occur in cases where tax is accrued incompletely, accrued on time, or tax loss is caused due to the taxpayer’s or responsible person’s incomplete fulfillment of their duties or responsibilities regarding taxation or failure to fulfill them on time, as well as in cases where the provisions of the Tax Laws related to form and procedure are not complied with.
Customs misdemeanors are behaviors in the form of non-compliance with the procedural provisions or causing tax loss due to differences and deficiencies in the declarations given to the customs administrations. Administrative fines imposed by the affiliated customs administrations in response to these behaviors are called “customs penalties“.
Article 3 of the Smuggling Law No. 5607 provides for a prison sentence due to the crime of customs smuggling. However, this article examines customs offenses requiring administrative fines rather than acts requiring imprisonment.
What Are The Tax Misdemeanors That Cause Tax Loss?
Tax loss is defined in Article 341 of the Tax Procedure Law as the failure to accrue the tax on time or the incomplete accrual due to the taxpayer’s or responsible person’s failure to fulfill their duties related to taxation on time or incomplete fulfillment.
Customs misdemeanors causing tax loss are regulated between Articles 234 and 238 of the Customs Law. Under these provisions, if the customs duty payer fails to fulfill the duties and obligations specified in the Law or causes a loss of customs duty due to their deliberate failure to fulfill, an administrative fine will be imposed against the taxpayer.
What Are Misdemeanors of Irregularity?
In Article 351 of the Tax Procedure Law, irregularity is defined as non-compliance with the formal and procedural provisions of the Tax Laws. Accordingly, regardless of any tax loss or damage, unlike the penalty for loss of tax, the act contrary to the rules of manner or procedure specified in the Law alone is sufficient to carry out the unlawful act that will require an administrative fine.
Misdemeanors of Irregularity are regulated by counting one by one between the 239th and 241st articles of the Customs Law. When these articles are examined, it is seen that the misdemeanor acts and the failure to comply with the procedural and formal rules of the Law regarding customs legislation are penalized.
