Understanding the Various Business Tariffs
The various business Tariffs available in the United Kingdom are designed to assist small to medium-sized businesses in sourcing the products and services they require to remain competitive. Tariffs are a legal obligation for many businesses to pay a specific rate for the imported goods that they require from other countries. Tariffs are established by each country and are subject to revision periodically. Tariffs are commonly applied when importing certain categories of goods. These categories include Imported Flowers and Plants, Imported Cars, and Imported Computers and Electronics.
The duty rate is determined by the government body
that issued the Tariff. The rates charged on these goods vary, depending on the type of item, its use and intended destination, and many other factors. For example, if an import car is needed to work in an automobile factory, the manufacturer will be required to pay a different rate than that for a similar item to be purchased directly from a consumer. There are several types of Tariffs available in the United Kingdom. The most commonly used tariff is the Single Tariff. The Single Tariff sets the duty and price for all imported goods.
A similar type of tariff is the Multi-Trading Tariff.
This is applied when importing goods in bulk and allows a trader to trade in more than one country. There are instances when traders can qualify for special treatment, such as those for agricultural or horticultural products. The most common tariff in the UK is the General Tariff. The G Tariff classifies goods into three categories; food, manufactured goods, and non-food items.
The rates charged for goods are governed by the rules set
out by the Government Tariff Office. The G Tariff Office implements the rules of the Tariff using a formula based on the unit price index. The various business tariffs allow importers to choose the most appropriate tariff for their products. Importers can use the tariffs to secure their competitive advantage. The importer has an obligation to follow the rules of the Tariff and to sell his products only to licensed retailers.
Some importers take advantage of the G Tariff’s
allowance to shift their goods without obtaining a written authorization from the G.O. The importer must provide documentation that he obtained the permission. The importer may also export goods below the quota permitted. The importer should not send goods above the quota to reach a non-European country. If an importer chooses to use the Single tariff for his import, he must be aware of the different rates applicable in the various parts of the United Kingdom. Rates for some imported goods can be very high in England and Wales and very low in Scotland.
Several factors affect the price of imported goods.
These include; the rate of exchange between the currencies of the countries, the difference in duty payable, and the rate at which imports are brought into the country. The importer’s goods will become expensive if he advertises them at the wrong time. The importer should always be aware of the rates at which his goods are sold in the United Kingdom. This way he will be able to attract the right customers and increase his profits by importing cheap goods.