Understanding What Customs is: Definition and Characteristics

Have Ballers ever heard of customs duties? This term is synonymous with import and export affairs. Information about customs duties is important for Ballers to know, especially for those who frequently travel abroad and bring back souvenirs.

Although not all goods will be subject to customs duties, it's important for you to know this information to understand it. That way, you can be better prepared when buying goods abroad, whether they fall under the characteristics of customs duties or not.

So, to find out complete information about what customs duties are and their characteristics, Ballers can refer to the explanation below.

Definition of Customs and Its Brief History

Customs duties are taxes levied on goods entering or leaving a country. Their purpose is to control the flow of goods, both incoming and outgoing, to protect the national economy and create a balance in international trade.

Based on Law No. 39 of 2007, customs duties are also imposed on goods classified as high-value or luxury goods, but not essential necessities. The aim is to maintain balance in the application of customs duties among consumers according to their income levels.

The history of customs duties itself dates back a long time. Historically, customs duties were one of the main sources of revenue for countries as international trade grew.

In the past, customs duties were generally levied in the form of physical goods such as salt, spices, and silk. However, with the development of times and technology, the customs system has evolved to what is known today.

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Characteristics and Types of Goods Subject to Customs Duties

Customs duties are imposed only on certain types of goods that meet specific characteristics. What characteristics of goods are subject to customs duties? Let's find out the answer below.

1. Characteristics of Customs Duties

In accordance with legal provisions, not all goods will be subject to customs duties. The imposition of customs duties by the state only applies to goods that have certain characteristics or types that have been regulated by the state.

The characteristics of goods that form the basis for customs duties are regulated in Law No. 35 of 2007. These characteristics differentiate customs duties from other trade product levies. Based on these regulations, the characteristics of goods that will be subject to customs duties are as follows.

• Goods whose distribution requires strict supervision.
• Goods whose use can have a negative impact on society and the environment.
• Goods whose consumption needs to be regulated and controlled.
• Goods that require state levies to achieve balance and fairness, or goods that are subject to excise duty based on statutory provisions.

2. Types of Goods Subject to Customs Duties

The types of goods subject to customs duties are very diverse. Some of them are as follows.

• Goods imported from other countries, such as gadgets, clothing, bicycles, and so on.
• Goods exported from within the country, such as agricultural products, textiles, and manufactured goods.
• Luxury goods such as luxury cars, jewelry, and other valuable items.
• Ethanol or ethyl alcohol produced without regard to the materials used in its manufacturing process.
• Alcoholic beverages with various ethyl alcohol contents, which do not comply with the manufacturing process and the ingredients used. This type includes concentrates with ethyl alcohol content.
• Tobacco products, such as cigarettes, cigars, sliced tobacco, leaf tobacco, and various other processed tobacco products. These products will be subject to customs duties if their production does not consider the use of auxiliary materials or substitutes.

Customs Duty Rates for Goods

Goods subject to customs duties will, of course, be charged for their distribution. The tariffs that must be paid for the types and characteristics of goods subject to customs duties are divided into two categories, which will be explained below.

1. Tobacco Products

One type of goods commonly subject to customs duties are tobacco products and their derivatives. The tariff for this type of goods, based on the market object, is divided into two parts, namely:

• Tobacco products produced in Indonesia: The customs duty tariff is 5% of the initial price if using the retail selling price, and 275% of the initial price if using the factory selling price.
• Imported tobacco products: The customs duty tariff is 57% of the initial price if using the retail selling price, and 275% of the initial price if using the customs value plus import duties.

2. Other Excise Goods

If the goods are not tobacco products or derivatives, they will fall under the tariff for other excise goods. Similar to tobacco products, the tariff for other excise goods is also divided into two, based on the market object, namely:

• Goods produced in Indonesia: The customs duty tariff is 80% of the initial price if using the retail selling price, and 1,150% of the initial price if using the factory selling price.
• Imported goods: The customs duty tariff is 80% of the initial price if using the retail selling price, and 1,150% of the initial price if using the customs value plus import duties.

That's a brief explanation of what customs duties are and their characteristics. Customs duties are taxes levied on goods entering or leaving a country. This aims to control the flow of goods, protect the national economy, and create a balance in international trade.

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When Ballers are on vacation and buy goods abroad, make sure you know whether the goods are subject to customs duties or not. If they are, you need to fill out the online form available at the airport and pay the tax on those goods.

To ensure the safety of the goods you purchase, you can carry them in a Baller aluminum suitcase. Baller offers various sizes of suitcases that you can use, from a 24-inch aluminum suitcase to a 28-inch one.

This suitcase is also equipped with international standard dual TSA combination locks. The suitcase is zipperless, making it easier to use. Baller's suitcases can also be used for your holidays. A 24-inch suitcase can accompany your holiday trip for 4-7 days with a maximum load of 20 kg.

So, what are you waiting for? Visit Baller now to get that strong aluminum suitcase. Your belongings will be safer thanks to using this Baller suitcase.