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Methods for determining the customs value

The Law of the Russian Federation "On the Customs Tariff" establishes six methods for determining the customs value:

• Transaction price method for imported goods-method 1
• Transaction price method with identical goods –method 2
• Method based on transaction price with homogeneous goods –method 3
• Cost subtraction method −method 4
• Cost addition method -method 5
• Fallback method -method 6

Determination of the customs value of goods must be started by the declarant with an attempt to apply method 1. And only if the conditions for applying method 1 are not met, methods 2–6 are successively applied. An exception is allowed only for methods 4 and 5, which can be applied in any order, i.e. it is possible to apply method 5 after method 3.

The law establishes that the main method for determining the customs value of goods is method 1, which corresponds to the Customs Value Code, which provides for the maximum possible use of the transaction price for customs valuation. The experience of countries that have been using this valuation system since 1981 shows that 90–98% of all export-import transactions are valued for customs purposes using this method.

Only for a very small number of transactions, the customs value is determined by methods 2-6, which are estimated, that is, those when the customs value of the goods being valued is determined not on the basis of the transaction price, but by conducting appropriate valuation calculations with the involvement of information on other transactions. The next most used method is 6.

Next, we will consider in more detail all methods for determining the customs value of goods imported into the customs territory of the Russian Federation.