Freight Shipping between Malaysia and Kazakhstan | Rates – Transit times – Duties and Taxes

How to calculate duties & taxes when importing from Malaysia to Kazakhstan?

Understanding how to calculate customs duties is a crucial part of any international trade operation. It can often seem complex, but once you get the key elements in place, it becomes considerably more manageable. The components you need to be aware of include: the country of origin, the Harmonized System (HS) Code, the Customs Value, the Applicable Tariff Rate, and additional taxes and fees that may relate to specific products.

Let's put it into context: Hypothetically, you're exporting palm oil from Malaysia to Kazakhstan. Your first step is determining the country where the goods were manufactured or produced. In this case, the palm oil is produced in Malaysia. This will set the stage for the next steps in calculating the duties and taxes applicable for this particular trade route.

Step 1 - Identify the Country of Origin

Recognizing the country of origin is the bedrock of importation, laying the groundwork for the subsequent steps. Here's why:

1. Trade Agreements: Malaysia and Kazakhstan share trade agreements that can significantly reduce customs duties - an opportunity you wouldn't want to miss! These agreements, however, hinge on the country of origin.

2. HS Code Determination: Identifying the country of origin is vital before getting the Harmonized System (HS) code, in line with international trade rules.

3. Customs Duties and Taxes: Customs duties could vary based on the country of origin. Leaving this blank can potentially inflate your costs.

4. Legal Implications: Incorrect information can result in compliance issues, penalties, or held shipments.

5. Import Restrictions: Certain goods might face limitations or requirements based on the originating country.

In the realm of Malaysian-Kazakhstani trade, note that some products have “non-preferential rules of origin”. This implies potential limitations or requirements. So, keep your country-of-origin knowledge close - it paves your way to smooth, cost-effective importation. No surprises, no unexpected charges. Thus, you maintain productive relations and a healthy bottom line.

Step 2 - Find the HS Code of your product

A Harmonized System (HS) code is a standardized multi-purpose tool utilized globally to classify traded products. It comprises six to ten digits, each providing progressively detailed information about the product in question – for instance, its material composition, how it's been manufactured, and its use. These codes play a significant role in determining how much duty you'll need to pay on your goods and allow customs authorities to understand exactly what they're dealing with.

Often, the simplest method of obtaining the HS code is to request it from your product supplier. They'll usually be familiar with the goods they're importing, along with the relevant regulatory measures.

However, in instances where this isn't an option, there's no need for concern. We're here to provide a convenient, step by step alternative.

Step One: Your journey towards identifying your HS code begins with accessing an HS lookup tool. One such tool is the Harmonized Tariff Schedule. Simply click on the name to be transported there.

Step Two: Once you're on the site, all you need to do is type the name of your product into the search bar.

Step Three: Following your search, direct your eyes to the Heading/Subheading column. The code you find there is your elusive HS code.

As you navigate this process, it's important to take heed of the following: Accuracy is your best friend when it comes to the HS codes. Incorrect or inaccurate codes can lead to unpleasant consequences like shipment delays or, worse, hefty fines. Therefore, while it's a straightforward process, ensuring you have the correct HS code is critically important to the efficiency and success of your shipment.

Just to make your shipping journey easier, we have provided an infographic on how to read an HS code.

Step 3 - Calculate the Customs Value

Calculating the customs value can seem complex, but it doesn't have to be. Let's take a step back and define 'customs value'. This isn't simply the price tag of your goods; it goes further. Imagine you're shipping beautiful Malaysian handicrafts to Kazakhstan.

You pay $1000 for the crafts, $200 for shipping, and $50 for insurance. Your customs value isn't just the $1000 you spent on the products; it's the total of all three costs - summing up to $1,250 (product cost + shipping + insurance).

This is also known as the CIF value. It's essential to remember these calculations when heading into the customs clearance process to avoid unnecessary surprises or hiccups. Keep a tab on these figures to ensure you're entirely in the loop during the entire shipping journey.

Step 4 - Figure out the applicable Import Tariff

In the world of logistics and transportation, an import tariff is a type of tax imposed on a specific category of imported goods, designated by an HS code, or Harmonized System code. This tariff differs from country to country.

For goods imported to Kazakhstan from Malaysia, Kazakhstan implements a system known as the Eurasian Economic Union Common Customs Tariff. You'll need the HS code of your product to identify the applicable import tariff.

Let's illustrate this. Assume you're importing footwears from Malaysia, whose HS code is 6403. The Eurasian Economic Union import tariff for this category is 17%. Also, imagine your cost, insurance, and freight (CIF) costs amount to $10,000.

To calculate your import duties, you'll apply the tariff rate to your CIF. So, in this case, import duties will be $10,000 17% = $1,700.

This process becomes crucial to understand the overall cost of your imports and foresee any financial implications. So remember, recognizing and accurately calculating your import tariff is an essential part of international shipping.

Step 5 - Consider other Import Duties and Taxes

Moving through the customs clearance process in Kazakhstan for items imported from Malaysia, you will encounter several costs aside from the standard tariff rate.

These can fluctuate based on the country of origin and the type of product. For instance, there are excise duties often imposed on luxury goods, such as high-end watches and premium cars. These duties can range from 10% to 30%.

Another potential expense is anti-dumping taxes, designed to protect local markets from certain foreign products sold below market price. The exact rate varies, but for context, in a hypothetical scenario, a Malaysian rubber product might carry an anti-dumping tax of 20%.

Finally, you'll also face Value Added Tax (VAT). In Kazakhstan, the standard VAT rate is 12% on imports, applied to the CIF value (Cost, Insurance, and Freight) plus duty. To demonstrate, if your CIF cost is $1,000 and the duty is $100, you'll pay $132 (12% of $1100) in VAT.

Remember, these are just examples to lend insights and the rates can differ. Always confirm the actual rates pertinent to your specific situation.

Step 6 - Calculate the Customs Duties

Calculating the customs duties when importing goods from Malaysia to Kazakhstan relies on a simple yet nuanced formula. It involves the customs value of the goods, anti-dumping taxes, and VAT where applicable. Let's break this down with our three scenarios.

If you're only dealing with the customs value, the duties can be easily determined by multiplying the customs value by the Kazakhstan customs duty rate.

In the second instance, where VAT comes into play, you'd calculate your customs duties first and then add this figure to the customs value. This becomes your taxable base, and applying the VAT rate gives you your final total.

Lastly, if anti-dumping taxes and Excise Duty apply, they get added to the customs value, subjecting the summative figure to the VAT, making this the most complex case.

For example, let's consider a $1000 consignment and let's assume a hypothetical customs duty rate of 20%, VAT of 15%, and anti-dumping tax of 5%. Here's how it would work out:

Scenario 1 (Customs value only): $1000 x 20% = $200 Customs Duties

Scenario 2 (Customs value + VAT): Customs Duties = $1000 x 20% = $200, Total Taxable base = $1000 + $200, VAT = $1200 x 15% = $180; Total duties = $200 + $180 = $380

Scenario 3 (Customs value + VAT + Anti-Dumping and Excise Duty): Customs Duties = $1000 x 20% = $200, Anti-Dumping = $1000 x 5% = $50; Total Taxable base = $1000 + $200 + $50, VAT = $1250 x 15% = $187.5; Total duties = $200 + $50 + $187.5 = $437.5

Remember, each trade agreement could result in a different customs duty rate, and VAT rates may vary too. DocShipper can handle every step of the customs clearance process for you, ensuring you are not overcharged. Contact us today for a free quote in less than 24 hours.

Bill of Lading

When shipping from Malaysia to Kazakhstan, your Bill of Lading (BOL) acts as the pivotal ticket. It signifies the transition of ownership, moving your cargo from exporter to importer. Think of it as a contractual handshake embodied on paper.

In today's digital age, you can lean towards a 'telex' or electronic release, fast-tracking the process. This keeps everything online, reduces paper waste, and accelerates customs clearance – a green and speedy win!

If you're opting for air freight, the Air Waybill (AWB) plays a similar role, so don't forget to fill it out meticulously. Remember, precision is key to ensure your goods breeze through customs without hitches. Explore the perks of electronic documentation for smooth sailing, literally!

Packing List

A Packing List is your trusty sidekick when shipping goods from Malaysia to Kazakhstan. Picture it as a detailed roll-call for all your items being transported. Whether you're sending textiles by sea or electronics by air, shipping cannot commence without it. It’s your responsibility to ensure absolute accuracy, as it outlines item quantities, descriptions, and weights, crucial for customs clearance. Imagine sending a batch of palm oil but your Packing List cites rubber gloves - a recipe for hold-up at customs. Creating an accurate Packing List is just like packing for an overseas vacation - you'd want to accurately declare what you're transporting to avoid troubles later. So, remember, every product Counts! The importance of precision can't be overstressed - it smooths your shipment's journey, facilitating faster, trouble-free customs clearance.

Commercial Invoice

Shipping between Malaysia and Kazakhstan? A well-prepared Commercial Invoice is your golden ticket to a smooth customs clearance process. This must-have document serves as a record of your transaction and includes vital details like the seller, buyer, description of goods, terms of delivery, and port of entry - it's essentially the DNA of your shipment.

When filling this out, ensure every detail aligns with other shipping documents like the Bill of Lading or Airway Bill, to avoid discrepancies, which can lead to costly delays. Remember, consistency is key here.

For example, if your shipment contains 100 LED lights, all your documents should reflect this exact description and quantity. This way, your goods can glide effortlessly through the Customs authorities in both countries.