Do you have any questions in regards to customs clearance or wondering how to calculate customs in Indonesia, this article able to help you answer a few of the questions, and please do not hesitate to post any question in regards to customs clearance in Indonesia below. Here is some question that was taken from an article from the Indonesian custom page. 

What is brokerage custom duty operation and how much is the customs duty price need to I pay for my goods?

Brokerage custom duty service means that the shipping company will calculate the tax and negotiate with the customs duty officer based on your declaration of invoices prior to shipping. With this service, the customer does not need to worry to handle the customs duty hassle as the shipping agency will help negotiate the tax and providing the necessary documents with the customs official.

A customs clearance duty service provider is a specialized entity that plays a pivotal role in international trade, ensuring that goods move smoothly across borders while complying with the regulations of each country. These providers are essential facilitators in the global supply chain, helping businesses navigate the complex web of tariffs, duties, and customs regulations. As international trade has become increasingly complex and globalized, the role of customs clearance duty service providers has grown significantly, making them indispensable in the modern economy.

In recent years, the global market for customs clearance services has expanded rapidly, driven by the growth of international trade and e-commerce. According to a report by Allied Market Research, the global customs brokerage market was valued at approximately $18 billion in 2021, and it is projected to reach $25 billion by 2030, growing at a compound annual growth rate (CAGR) of 3.7% from 2022 to 2030. This growth is fueled by several factors, including the increasing volume of cross-border shipments, the complexity of customs regulations, and the rising demand for efficient supply chain management.

The reach of customs clearance duty service providers is extensive, covering a wide range of industries and markets. These providers cater to businesses of all sizes, from small and medium-sized enterprises (SMEs) to large multinational corporations. They offer a variety of services, including customs documentation, tariff classification, duty calculation, and payment processing. In addition, they provide guidance on trade compliance, helping businesses avoid costly penalties and delays. This broad range of services makes customs clearance duty service providers crucial partners for companies engaged in international trade.

One of the key trends in the customs clearance industry is the increasing adoption of technology to streamline processes and improve efficiency. The rise of digitalization and automation has transformed the way customs clearance is conducted, with many providers leveraging advanced software solutions to manage customs documentation, track shipments, and ensure compliance with regulations. For example, companies like FedEx and DHL have invested heavily in technology to enhance their customs clearance capabilities, offering customers real-time tracking and automated customs processing. This has not only improved the speed and accuracy of customs clearance but has also reduced the cost of these services.

Another significant trend is the growing demand for customs clearance services driven by the expansion of e-commerce. The rapid growth of online shopping has led to a surge in cross-border shipments, with consumers increasingly purchasing goods from international sellers. This has created a need for efficient customs clearance services that can handle the high volume of small parcels and ensure that they are delivered to customers in a timely manner. According to the United Nations Conference on Trade and Development (UNCTAD), global e-commerce sales reached $26.7 trillion in 2020, and this figure is expected to continue rising in the coming years. Customs clearance duty service providers are playing a crucial role in facilitating this growth, helping e-commerce companies navigate the complexities of international trade and deliver goods to customers around the world.

The impact of customs clearance duty service providers on the world market is profound. They enable businesses to access new markets, expand their customer base, and increase their revenue. By ensuring that goods comply with customs regulations and are cleared quickly and efficiently, these providers help companies avoid costly delays and penalties, which can have a significant impact on their bottom line. In addition, they contribute to the overall efficiency of the global supply chain, reducing the time and cost associated with moving goods across borders.

For the general world customer market, customs clearance duty service providers offer several benefits. First and foremost, they help ensure that goods purchased from international sellers are delivered in a timely manner and without any unexpected costs. This is particularly important in the e-commerce market, where customers expect fast and reliable delivery. Customs clearance providers also play a key role in ensuring that products comply with safety and quality standards, protecting consumers from potentially harmful or counterfeit goods.

The impact of recent events, such as the COVID-19 pandemic, has highlighted the importance of customs clearance duty service providers in maintaining the flow of goods across borders. During the pandemic, the global supply chain was severely disrupted, leading to delays and shortages of essential goods. Customs clearance providers were instrumental in mitigating these disruptions, working closely with governments and businesses to expedite the clearance of critical supplies such as medical equipment and personal protective equipment (PPE). This demonstrated the vital role that these providers play in ensuring the resilience and stability of the global supply chain.

Several brands and companies have emerged as leaders in the customs clearance industry, leveraging their expertise and technology to provide high-quality services to their customers. For example, United Parcel Service (UPS) is one of the largest customs brokers in the world, offering a comprehensive range of customs clearance services to businesses in over 220 countries and territories. UPS has invested heavily in technology, including its proprietary customs brokerage system, which automates many of the processes involved in customs clearance. This has enabled the company to handle a large volume of shipments efficiently and accurately, reducing the risk of delays and errors.

Similarly, Expeditors International, a global logistics company, has established itself as a leader in the customs clearance market. The company offers a wide range of customs brokerage services, including duty calculation, trade compliance consulting, and tariff classification. Expeditors has also invested in technology, using advanced software solutions to manage customs documentation and track shipments in real-time. This has allowed the company to provide its customers with a high level of service and ensure that their goods are cleared quickly and efficiently.

Looking to the future, the customs clearance industry is expected to continue evolving in response to changes in the global trade environment. The ongoing trade tensions between major economies, such as the United States and China, have led to increased scrutiny of customs regulations and tariffs, creating new challenges for businesses engaged in international trade. In addition, the growing focus on sustainability and environmental responsibility is likely to impact the customs clearance industry, with governments introducing new regulations aimed at reducing the carbon footprint of international trade. Customs clearance duty service providers will need to adapt to these changes, leveraging technology and expertise to help their customers navigate the evolving trade landscape.

Customs clearance duty service providers play a critical role in the global economy, facilitating the movement of goods across borders and ensuring compliance with customs regulations. The market for these services is growing rapidly, driven by the expansion of international trade and e-commerce. Technology is playing a key role in transforming the industry, improving the efficiency and accuracy of customs clearance processes. As the global trade environment continues to evolve, customs clearance duty service providers will remain essential partners for businesses seeking to navigate the complexities of international trade and access new markets.

Can I ship like vitamins, essential oil, herbs to Indonesia?

By rules, you need to have the proper documentation from the Indonesian Trading Ministry or Health Ministry to import any goods related to human use whether it is herbal, natural, etc. But if you import the goods in little amount for personal use, we can help you obtain the proper permit to import the goods to Indonesia.

Shipping vitamins, essential oils, and herbs across international borders is a complex process fraught with challenges that are not immediately apparent to the casual observer. These products, while popular and widely used in various markets, are considered sensitive due to a combination of regulatory, cultural, and market-specific factors. Understanding why these items are treated with such care during cross-border transactions requires a deep dive into market dynamics, regulatory landscapes, and the ever-changing trends in consumer behavior.

The global market for vitamins, essential oils, and herbs is immense and continually growing. According to a report by Grand View Research, the global dietary supplements market, which includes vitamins and herbal products, was valued at USD 151.9 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 8.9% from 2022 to 2030. This growth is driven by increasing consumer awareness of health and wellness, the aging global population, and a growing preference for natural and organic products. Essential oils, which are often used in aromatherapy, personal care, and household cleaning products, also represent a significant market. The global essential oils market was valued at USD 7.03 billion in 2020 and is projected to grow at a CAGR of 7.4% from 2021 to 2028.

Despite the lucrative nature of these markets, the cross-border shipment of such products is fraught with challenges. Regulatory issues are among the most significant obstacles. Vitamins, essential oils, and herbs are subject to different classifications depending on the country. In some regions, they are considered dietary supplements, while in others, they might be classified as pharmaceuticals or even as controlled substances. The European Union, for instance, has stringent regulations regarding the importation of herbal products and essential oils. These products must comply with the EU’s REACH (Registration, Evaluation, Authorisation, and Restriction of Chemicals) regulation, which aims to ensure the safe use of chemical substances. Similarly, the United States Food and Drug Administration (FDA) regulates dietary supplements, including vitamins and herbal products, under the Dietary Supplement Health and Education Act of 1994 (DSHEA). The DSHEA requires manufacturers to ensure that their products are safe, but the FDA does not review dietary supplements for effectiveness before they are marketed, adding another layer of complexity to cross-border shipments.

Cultural factors also play a role in the sensitivity of shipping these products. Different countries have varying cultural attitudes toward the use of vitamins, essential oils, and herbs. For example, traditional Chinese medicine, which heavily relies on herbal products, is widely accepted and practiced in China. However, the same herbs may not be as readily accepted or might even be restricted in other countries. This cultural variance can lead to complications in the shipping process, as products may be subject to additional scrutiny or even rejection at the border.

The market reach of vitamins, essential oils, and herbs is extensive, with these products being popular among a diverse range of consumers worldwide. The increasing trend toward health and wellness, particularly in the wake of the COVID-19 pandemic, has driven demand for these products even higher. Consumers are more focused than ever on maintaining their health, leading to a surge in the purchase of vitamins, herbal supplements, and essential oils. This trend is particularly strong among millennials and Gen Z consumers, who are more likely to seek out natural and organic products. According to a survey by the Council for Responsible Nutrition, 77% of American adults reported taking dietary supplements in 2019, with vitamins and minerals being the most popular. This trend is mirrored globally, with rising demand in Europe, Asia, and other regions.

However, this broad market reach also contributes to the sensitivity of these products when shipped across borders. As demand grows, so does the potential for counterfeit products entering the market. The World Health Organization (WHO) estimates that 1 in 10 medical products in low- and middle-income countries is substandard or falsified, and this problem is not limited to pharmaceuticals. Vitamins, essential oils, and herbal supplements are also at risk of counterfeiting, which can lead to significant health risks for consumers and legal complications for companies. This issue is particularly prevalent in the online marketplace, where consumers often purchase products from international sellers. The risk of receiving counterfeit products is higher when buying from unregulated sources, making cross-border shipments of these products particularly sensitive.

The impact of these sensitivities on the global market cannot be overstated. Companies that manufacture and sell vitamins, essential oils, and herbs must navigate a complex web of regulations and cultural differences to reach consumers in different countries. Failure to comply with local regulations can result in products being held up at customs, returned to the sender, or even destroyed. This not only leads to financial losses for companies but can also damage their reputation and erode consumer trust. Furthermore, the rise of e-commerce has made it easier for consumers to purchase these products from international sellers, increasing the volume of cross-border shipments and, consequently, the potential for regulatory issues.

The recent trend toward sustainable and ethical sourcing of ingredients also adds another layer of complexity to the cross-border shipment of vitamins, essential oils, and herbs. Consumers are increasingly demanding products that are not only effective but also sourced and produced in an environmentally and socially responsible manner. This has led to the growth of certifications such as Fair Trade, Organic, and Non-GMO, which require companies to adhere to strict standards. However, obtaining these certifications can be challenging, particularly for small and medium-sized enterprises (SMEs) that may not have the resources to navigate the complex certification process. Additionally, products that carry these certifications may be subject to additional scrutiny during cross-border shipments, further contributing to the sensitivity of these products.

In terms of recent events and trends, the COVID-19 pandemic has had a significant impact on the global market for vitamins, essential oils, and herbs. The pandemic has heightened consumer awareness of the importance of health and wellness, leading to a surge in demand for these products. According to a report by Nielsen, sales of immunity-boosting supplements, including vitamins C and D, zinc, and elderberry, increased by 255% in the first quarter of 2020 compared to the same period in 2019. This surge in demand has led to supply chain disruptions, as manufacturers struggle to keep up with the increased demand. Furthermore, the pandemic has highlighted the importance of ensuring the safety and quality of these products, as consumers are more cautious about the products they use to maintain their health.

The cross-border shipment of vitamins, essential oils, and herbs is a complex and sensitive process that is influenced by a variety of factors, including regulatory issues, cultural differences, market reach, and recent trends. Companies operating in this space must navigate these challenges carefully to succeed in the global market. The growing demand for these products, driven by trends in health and wellness and the rise of e-commerce, presents significant opportunities for companies, but also comes with risks that must be carefully managed. As the market continues to grow, the importance of ensuring the safety, quality, and authenticity of these products will only increase, making the cross-border shipment of vitamins, essential oils, and herbs an ever more sensitive and challenging endeavor.

If my goods are on customs processing, who will inform me about the updates?

Usually is your shipping agency will update you in regards to the matter or you can always check it online with real-time based on your tracking number provided (if any). Usually when it stated that the status on the website as “package are in customs clearance”, you can expect to take a minimum between two to three days to clear from customs duty.

What if my goods been confiscated by custom or I receive the goods in partial only?

It would be better to check again with your shipping agency and make sure what is the main reason your goods are confiscated by custom and if you do not feel satisfied with the customs duty answer, you can appeal to the respective department and get the answer directly from the custom officer

If you received the goods in partial it would be best to check with shipping agency and confirm with them whether your goods held in custom, for how long, is there any feedback from the custom in regards of your shipment or is there any product that custom duty officer declares with your shipping agency that has taken due to some reason and get really clear about the situation. Most importantly, always check the box condition while you receive the goods and make the complaint to the shipping agency immediately to trace back why you do not receive the complete shipment or how is it possible that some of your goods have been missing during shipment or transit.

What is “green light” and “red light” means while importing to Indonesia?

This term widely uses by shipping agencies related to the shipping industry to Indonesia. The terms are to determine whether an increase than the regular check from a customs duty officer related to the shipping period. The red light period means there might be more checks while in transit which able to make the shipment delayed. 

Actually, the real terms that been used by customs duty officer is a green channel, yellow channel, red channel based on Indonesian custom duty information websites. The Green channel means only documentation will be checked as the goods will be cleared immediately. Usually, in these terms, the importer already been in the industry for a few years and has a goods report and conduct with customs duty. The importer also off the red channel list and every shipment has immediate approval from a customs duty officer. It is good to plan for importers to be able to keep up a good report with the customs duty of Indonesia which can be cleared to green channel clearance.

Yellow channel (warning) means another documentation needed before it can be cleared. If the shipment under the yellow channel, the goods are cleared but the importer needs to produce extra documents so the goods can be cleared by the custom duty officer.

Red channel means a physical check of the goods is required on every shipment that coming to the country. Usually, this channel is for the new importer or any importer that have falsely the documents before or been in some illegal case with the customs duty officer. Other factors are changes in tax, regulation, HS code number, etc.

What is the maximum amount on the invoice allowed to be able to obtain free import duties to Indonesia?

For shipping personal goods or parcels, it is USD 3 per person per shipment CIF (cargo, insurance, freight) but if you flying with the goods, you can obtain up to USD 500 via the airport.

CIF consists of (cargo, insurance, freight). Cargo means the cargo price in terms of the invoice price of agreement between seller and buyer when the goods imported to the country and it should be able to compare to the market price on a particular time by the customs duty officer. Insurance means the insurance (if any) for the particular shipment during importing. Sometimes, a customs duty will look at the insurance price and compared it with the invoice price as a comparison. High insurance but low invoice price will raise some suspicion in regards to the true value of the goods as the invoice can be undervalued to avoid tax. Freight means the price of shipment from the origin country to Indonesia. And all of the charges totaled and you will get CIF amount that the customs duty will use for calculating the tax.

Amount of USD 3 that the Indonesian government allowed to obtain free tax compared to the countries around Indonesia is comparably low, as Singapore has free custom duty up to SGD 400 = USD 250, Malaysia up to MYR 500 = USD 130, Philippines PHP 10,000 = USD 200. Perhaps the purpose and measurement with a low allowance on import tax are so the Indonesian government able to increase country income from import tax (custom and duty) and to have controlled the movement of import goods in the country as stated in the Indonesian custom websites.

Des Minimis, a term rooted in legal vernacular, has become increasingly significant in the context of cross-border parcel shipping. It refers to the minimum threshold below which goods are exempt from duties and taxes when imported into a country. This threshold varies globally, but its impact on international trade, particularly in e-commerce, is profound. In recent years, the explosion of online shopping, spurred by giants like Amazon, Alibaba, and Shopify, has placed Des Minimis at the forefront of global trade discussions. As we delve into the nuances of Des Minimis, its market implications, trends, and impact on the world market and general consumer base, the significance of this seemingly technical term becomes clear.

The global e-commerce market, valued at approximately $5.7 trillion in 2022, is projected to reach $7.4 trillion by 2025. Within this landscape, cross-border e-commerce plays a crucial role, accounting for around 22% of total e-commerce transactions. The appeal of cross-border shopping lies in the vast array of products available at competitive prices, often unavailable domestically. Des Minimis thresholds significantly influence consumer behavior in this space, as they determine the additional costs incurred when purchasing goods from abroad. For instance, in the United States, the Des Minimis threshold is set at $800, meaning any goods valued below this amount are exempt from import duties and taxes. In contrast, the European Union’s threshold is considerably lower, at €150, reflecting the diverse approaches to taxation and trade across different regions.

The market reach of Des Minimis is extensive, affecting both consumers and businesses worldwide. For businesses, particularly small and medium-sized enterprises (SMEs), Des Minimis thresholds can be a double-edged sword. On the one hand, higher thresholds like those in the US encourage more cross-border sales by reducing the cost burden on consumers, thereby increasing market access for foreign sellers. On the other hand, lower thresholds, such as those in the EU, can discourage consumers from purchasing from overseas sellers, limiting market opportunities. For example, a small business in China selling to European customers must carefully consider the pricing of its products, as goods exceeding the €150 threshold will be subject to additional charges, potentially deterring buyers.

The trend toward increasing Des Minimis thresholds, particularly in regions like North America, has been driven by the rapid growth of e-commerce and the desire to streamline customs processes. Simplifying customs procedures reduces administrative costs for governments and speeds up the delivery process for consumers. In 2016, the US raised its Des Minimis threshold from $200 to $800, a move that significantly boosted cross-border e-commerce, particularly from China. This increase was partly in response to the growing demand for faster and cheaper shipping options, as consumers became more accustomed to the convenience of online shopping. The rise of platforms like AliExpress, which offers low-cost goods from Chinese sellers, has been particularly influential in this trend.

The impact of Des Minimis on the world market is multifaceted. For one, it has accelerated the globalization of e-commerce, enabling consumers to access a broader range of products from different countries. This has been particularly beneficial for consumers in smaller or developing markets, where local options may be limited. Moreover, Des Minimis thresholds have allowed international sellers to tap into new markets with relative ease, fostering competition and driving down prices. However, this has also led to challenges, particularly for domestic retailers in countries with high Des Minimis thresholds. These retailers often struggle to compete with cheaper imports, leading to calls for stricter regulations or lower thresholds to protect local industries.

For the general consumer market, Des Minimis thresholds play a crucial role in shaping shopping behavior. Consumers are increasingly savvy, often calculating the total cost of a purchase, including potential duties and taxes, before deciding whether to buy from an overseas seller. High Des Minimis thresholds encourage consumers to shop internationally, as they can avoid additional charges, making foreign goods more attractive. Conversely, low thresholds may discourage cross-border shopping, leading consumers to favor domestic retailers. This dynamic is particularly evident in markets like the European Union, where the lower threshold often results in consumers being hit with unexpected charges upon delivery, leading to frustration and a preference for local options.

The recent shift in global trade dynamics, particularly in light of the COVID-19 pandemic, has further highlighted the importance of Des Minimis thresholds. The pandemic accelerated the growth of e-commerce as lockdowns and social distancing measures forced consumers online. This surge in online shopping led to a significant increase in cross-border transactions, placing additional pressure on customs authorities worldwide. In response, many countries have reevaluated their Des Minimis thresholds, with some opting to raise them to facilitate trade and others lowering them to protect domestic industries. For example, Australia lowered its threshold from AUD 1,000 to AUD 75 in 2018, a move aimed at leveling the playing field for local retailers.

The interplay between Des Minimis thresholds and the broader global economy is also evident in the ongoing trade tensions between major economies. For instance, the US-China trade war has led to increased scrutiny of cross-border e-commerce, with both countries implementing measures to protect their domestic industries. In this context, Des Minimis thresholds have become a tool for governments to either encourage or restrict imports, depending on their broader trade policies. For example, in 2020, the US imposed additional tariffs on Chinese goods, including those previously exempt under the Des Minimis rule, as part of its broader strategy to reduce its trade deficit with China.

The influence of Des Minimis on the market is also reflected in the strategies of major e-commerce platforms. Companies like Amazon and Alibaba have invested heavily in logistics and supply chain management to ensure that their goods can be delivered quickly and efficiently across borders, often leveraging Des Minimis thresholds to offer competitive prices. For example, Amazon’s global shipping program allows US sellers to reach customers in over 100 countries, with many items falling below local Des Minimis thresholds, thus avoiding additional charges. Similarly, Alibaba’s Cainiao logistics network has been instrumental in reducing shipping times and costs for Chinese sellers, making their products more attractive to international buyers.

Des Minimis is a crucial factor in the global parcel shipping landscape, with far-reaching implications for businesses, consumers, and economies worldwide. Its role in facilitating cross-border e-commerce, shaping consumer behavior, and influencing trade policies cannot be understated. As e-commerce continues to grow and evolve, the importance of Des Minimis thresholds will only increase, making it a key consideration for policymakers, businesses, and consumers alike. The balance between encouraging international trade and protecting domestic industries will continue to shape the future of Des Minimis, with significant implications for the global economy and the millions of consumers who participate in cross-border shopping.

How to calculate the custom import duties?

1. Invoice or transaction CIF amount (Cargo, Insurance, Freight) as the shipper need to produce the documentation needed during the importing process, if the goods found without any proper documentation, some risk involved are the goods might be confiscated, return to the shipper, or held in custom for quite some time.
2. The customs duty officer will be able to determine based on the market value on the time of import if no full documentation produced upon checks by customs duty officer or if the officer has doubts on the invoice amount stated on the importation documents that very low (undervalue) from the market price of the imported goods.

How to calculate the import tax for every good in one shipment if the goods imported more than one (1) item? 

1. Custom tax calculated based on the HS code of particular goods on import (you can access it at Indonesia custom duty websites.
2. If the HS code type is more than one, the customs officer will determine the tax rate on which one is the highest between particular goods that imported.

It is important to be as clear as possible in the invoice tax paper during declaration or before you ship the goods to Indonesia as to help the shipping company to be able to declare the goods easily without any problem with customs duty officer as lack of documentation able to make some shipment delay on the process.

How much is the imported rate for Goods and Service Tax?

10% for Goods and Service Tax – VAT based on the Indonesian government tax code.

How much is income import tax?

The import tax will be varied depends on whether the recipient of the goods has the API (registration of import) or not. API has usually given to companies to import industrial or company scale goods that have been regulated by the Indonesian government with a strict allowance or general cargo. Another documentation is NPWP (national tax registration code) that issued to companies or individuals to report yearly tax payments and such. Tax value is varied based on whether the recipient able to produce both documentation as listed:

1. if the owner of the goods has API (the registration of import) and able to show NPWP (national tax registration code number), it will be given of 2,5% tax from import value.
2. if the owner of the goods has API but can’t show the NPWP, import rate is 5%
3. if the owner of goods don t have API but own NPWP, the tariff would be 10%
4. If the owner of the goods do not have both, the import tariff would be 20% from import value

Note: The facility of USD 3 free tax import custom only for personal goods not for companies importing goods to Indonesia. 

Based on the list above, if you have the registration of import and national tax registration code you only need to pay 2,5 % compared if you do not have both you need to pay 20% from total value but keep in mind, mostly the one that has both documentation is a large corporation or companies that regularly importing the goods to Indonesia. 

Some Cases of Shipping to Calculate the Tax:

I buy goods USD 550 with shipment charges USD 50 with EMS Cargo (Pos Indonesia). How much do I need to pay for duties? (I have NPWP but not API)

Rate 1 USD: Rp. 10.000,00

Income tax 22 10%

Import GST 10%

Import duties 7,5%

Cost of goods USD 500, free up USD 75 = USD 425. (Cost)

Shipping Charges USD 50 (Freight)

Insurance: 0,5% x (Price after deduction of allowance of tax + shipping charges) = 0,5 x USD 475 = USD 23,75.

Value of Taxable (CIF) = 498,75 x Rp. 10.000,00 = Rp. 4,987,500

Import duties = 10% x Value = Rp. 498,750,00

Import Value = Value of Taxable + Import duties = Rp. 4,987,500,00 + Rp. 498,750,00 = Rp. 5.486.250

Import GST (Good and Service Tax/ VAT) = 10% x Import Value= Rp. 548,625,00

Income Import tax = 7,5% x Import Value = Rp. 415,000,00 (rounded up)

Import custom duty that needs to be paid: Rp 963,625.00

What if the goods need additional documentation for import from other government agencies?

If the goods fall under the list of prohibited and limited items for import, the importer needs to obtain an additional import license from some of the local agencies for importation to Indonesia. Without the license paper, it is almost impossible to bring goods to Indonesia. A few examples of import license: BPOM license from Indonesian Health Agency, Quarantine paper from Agriculture or Fishery Agency, Trading License from Trading Ministry, etc. It is important to be able to seek approval of shipping before you commence the shipping to Indonesia as without proper shipping documents there will be a lot of risks involved during the shipping.

How to appeal for customs charges or tax as your goods invoice is lower as declared by customs officer?

First, you need to appeal with the shipping company which you use the service to ship the goods to Indonesia maximum 3 days after the declaration in writing with the reasons as the shipping company represent you as an importer and if your appeal is approved, the customs officer will recalculate (revision) the value and declaration invoice and there is a new amount you need to pay.

Based on previous experience and reports, some of the cases are approved but the majority of cases are not approved in regards to the rate of the successful applicant of the tax duty appeal case. The documentation that you need to represent must be quite assuring for custom and duty officers. As usually when the customs duty has determined the value of your shipment for the first time, the customs officer will refer back to the first judgment on why determining the tax previously.

What if I purchase the goods together and separate the shipping but come together at once in Indonesia?

The customs officer will combine the airway bill and charge it as one shipment and documents, as the rule of thumb applies for USD 3 waived of tax is based on per day per shipment per person. As long as the recipient name stated on the airway bill, the customs officials have the right to combined it and look the case as one shipment. It would be better if you can send it on different dates of shipping as to obtain free custom tax duties up to USD 3 per shipment per day per recipient. 

What if my shipment is a gift from abroad to Indonesia?

Customs charges will put the value as the market price in the moment of importation, except if the goods have no economic value at all. Even if you think that there is no value for the goods please ensure to declare the value of the goods with the shipping company, even samples or extra bonus goods have a value in custom duty officer. Keep in mind to always, always, put value in your shipping goods for custom duty purposes.

When sending a parcel from one country to another, whether it’s a gift or a commercial item, the concept of customs clearance comes into play, which often results in additional costs. Even when the parcel is a gift, it’s crucial to understand why customs clearance fees are still applicable. This seemingly bureaucratic requirement is rooted in complex international trade laws, market dynamics, and economic policies designed to regulate the flow of goods across borders. Despite the good intentions behind sending gifts, these regulations ensure that countries maintain control over imports and protect their economies from potential imbalances. Let’s delve into the reasons behind this, exploring the market, trends, and the global impact of customs clearance in the context of gifting.

The global market for cross-border parcel shipments has seen exponential growth over the past decade, largely driven by the boom in e-commerce and the ease with which individuals can now send items across the world. The international parcel market is estimated to be worth over $400 billion, with a significant portion of this market dedicated to personal shipments, including gifts. As of 2023, cross-border e-commerce alone accounted for nearly 22% of all online sales globally, a figure expected to rise as more consumers engage in purchasing and sending goods internationally. This growing market has necessitated the development of stringent customs regulations to manage and monitor the influx of goods into countries, regardless of whether these goods are intended for personal or commercial use.

Customs duties and taxes are imposed primarily to protect domestic industries and to ensure that all goods entering a country contribute to the local economy, even if the parcel is a gift. These duties are part of broader trade policies designed to prevent market distortions that could arise from an unchecked influx of foreign goods. For instance, if a country allows gifts to enter without any customs clearance, it could open a loophole where individuals and businesses might declare commercial goods as gifts to avoid paying duties. This would undermine local businesses that are subject to taxation and could lead to significant revenue losses for governments. In the European Union, for example, import duties are imposed on gifts valued over €45, and in the United States, the threshold is set at $100. These thresholds are in place to prevent abuse of the gifting system and to maintain a level playing field for all market participants.

Recent trends in global trade have also influenced customs regulations. The rise of direct-to-consumer (DTC) models, where companies ship products directly from international warehouses to customers, has blurred the lines between personal and commercial shipments. Companies like Amazon, AliExpress, and Shein have capitalized on this trend, offering consumers the ability to send items directly to recipients in other countries, often as gifts. However, these shipments are still subject to customs duties because they contribute to the overall trade balance and can impact domestic markets. In 2022, Amazon alone shipped over 1.6 billion packages worldwide, with a significant percentage of these being gifts. This volume of cross-border trade has put pressure on customs authorities to enforce regulations consistently, ensuring that all imports, regardless of their intended use, are properly documented and taxed.

From a technical standpoint, customs clearance involves a detailed assessment of the parcel’s contents, value, and origin. This process is designed to ensure that all imported goods comply with national regulations, including safety standards, import restrictions, and tax obligations. Even if a parcel is a gift, it must go through this process to verify that it does not contain prohibited items or exceed the value thresholds that would subject it to higher duties. In many countries, customs authorities use advanced technology, such as automated systems and AI-driven algorithms, to streamline this process and minimize delays. For instance, the World Customs Organization (WCO) has implemented the “SAFE Framework of Standards” to facilitate faster and more efficient customs clearance, which is particularly important given the increasing volume of international parcels. However, this technology also ensures that no parcel, whether a gift or a commercial shipment, bypasses the necessary checks.

The impact of customs clearance on the global market is significant. It plays a crucial role in maintaining the balance of trade between countries, preventing market saturation with foreign goods, and protecting domestic industries from unfair competition. By imposing duties on imported goods, including gifts, countries can generate revenue that supports public services and infrastructure. For example, in 2021, customs duties and taxes collected on imports contributed over $300 billion to government revenues worldwide. This revenue is essential for funding various national initiatives, from healthcare to education, and helps maintain economic stability.

Moreover, the requirement for customs clearance on gifts has a broader impact on the world’s consumer market. It encourages transparency and accountability in cross-border transactions, ensuring that all parties involved in the shipment and receipt of goods are aware of the legal and financial obligations. This transparency is vital for building trust in the global market, especially as more consumers and businesses engage in international trade. Companies like DHL and FedEx have recognized the importance of clear communication about customs duties and have developed tools that allow customers to calculate potential charges before sending parcels. These tools are particularly useful during peak gifting seasons, such as Christmas and Valentine’s Day, when the volume of international shipments spikes.

In recent years, there have been calls for reforms to the customs clearance process, particularly in relation to gifts. Some argue that the thresholds for duty-free gifts should be raised to reflect inflation and the increasing cost of goods. Others suggest that certain categories of gifts, such as personal items sent between family members, should be exempt from customs duties altogether. However, while these proposals have gained some traction, they face significant challenges due to the complexities of international trade agreements and the need to protect domestic markets. The World Trade Organization (WTO) and other international bodies continue to play a key role in shaping customs policies, balancing the interests of individual countries with the need for a fair and open global trading system.

The requirement to pay customs clearance fees on gifts sent from abroad is a reflection of the intricate and interconnected nature of the global economy. While it may seem burdensome to pay additional fees on what is intended to be a gesture of goodwill, these regulations are in place to protect domestic markets, ensure fair trade practices, and generate revenue for governments. As the global parcel market continues to grow, driven by e-commerce and the increasing ease of international shipments, customs authorities will likely continue to enforce these rules, adapting them as necessary to reflect changing market dynamics. For consumers and businesses alike, understanding the reasons behind these fees is essential for navigating the complexities of international trade and ensuring that gifts sent across borders comply with all relevant regulations.

Is there any exception to shipping goods for the importation tax scheme?

1. Goods for commercial as there s no USD 3 free tax charges as the facility is only for personal goods.
2. Sample product (no import tax for the sample in small quantities).

Keep in mind to always put value even for the sample, the custom duty officer will determine whether the tax will be waived for the sample product for the laboratory tests, a sample for business, etc.

Why I need to put value on sample from abroad for custom purpose?

In today’s globalized economy, the importance of placing value on samples from abroad for customs purposes cannot be overstated. With the world increasingly interconnected through trade, the flow of goods across borders has become a vital component of business operations. Understanding the significance of correctly valuing these samples is crucial not only for ensuring compliance with international trade laws but also for optimizing business strategies that align with current market trends and customer demands.

The global market has expanded at an unprecedented rate over the past few decades. According to the World Trade Organization, the volume of global merchandise trade reached approximately $25 trillion in 2022, a significant increase from $19 trillion in 2018. This growth highlights the sheer scale of international trade and the importance of accurately assessing the value of goods, including samples, for customs purposes. When businesses fail to properly value these samples, they risk legal penalties, delays, and even the seizure of goods, all of which can have detrimental effects on their operations.

One of the primary reasons for valuing samples correctly is to maintain fair competition in the market. The global market is highly competitive, with companies from various countries vying for a share of the consumer base. In this context, undervaluing or overvaluing samples can distort the playing field, leading to unfair advantages or disadvantages. For example, if a company undervalues its samples, it may pay less in customs duties, giving it a price advantage over competitors who adhere to proper valuation practices. Conversely, overvaluing samples can lead to higher costs, making products less competitive in terms of pricing. By ensuring accurate valuation, businesses can contribute to a more equitable market environment, benefiting both companies and consumers.

The reach of the global market has extended to virtually every corner of the world, thanks to advancements in technology and logistics. E-commerce platforms like Amazon, Alibaba, and eBay have revolutionized the way products are bought and sold, enabling consumers to access goods from across the globe with just a few clicks. According to a report by Statista, global e-commerce sales reached $5.7 trillion in 2022, with projections indicating further growth in the coming years. In this context, the role of samples becomes even more critical. Companies often send samples to potential customers, distributors, or partners in different countries to showcase their products and generate interest. By placing accurate value on these samples, businesses can ensure smooth customs clearance, minimizing delays and ensuring that their products reach their intended recipients promptly.

The trend towards globalization has also led to an increase in cross-border trade, with companies sourcing materials, components, and finished products from various countries. This trend has been particularly evident in industries such as electronics, fashion, and automotive, where supply chains span multiple countries. For instance, a smartphone might be designed in the United States, manufactured in China, and assembled in India, with components sourced from various countries in between. In such complex supply chains, samples play a crucial role in quality control, product development, and market testing. Valuing these samples correctly is essential to avoid customs issues that could disrupt the entire supply chain.

The impact of valuing samples for customs purposes extends beyond individual businesses to the broader world market. When companies fail to comply with customs regulations, it can lead to trade disputes between countries, affecting global trade relations. In recent years, there have been several high-profile cases where improper customs practices have led to tensions between trading partners. For example, in 2020, the United States imposed tariffs on European Union goods as part of a long-running dispute over subsidies to aircraft manufacturers Airbus and Boeing. While this case involved entire products rather than samples, it underscores the importance of adhering to customs regulations to maintain smooth trade relations. By placing value on samples, businesses can contribute to the stability of the global trading system, fostering cooperation and trust between countries.

From a technical standpoint, the process of valuing samples for customs purposes involves several key considerations. First and foremost, businesses must determine the fair market value of the sample, taking into account factors such as the cost of production, transportation, and any applicable taxes or duties. The World Customs Organization (WCO) provides guidelines on how to value samples, emphasizing the need for transparency and accuracy in the valuation process. Additionally, companies must consider the intended use of the sample, as this can affect its value. For example, a sample intended for promotional purposes may have a different value than one intended for resale or further manufacturing.

Recent trends in the global market have highlighted the growing importance of valuing samples correctly. With the rise of sustainability and ethical consumption, consumers are increasingly demanding transparency in supply chains and business practices. Companies that prioritize ethical trade practices, including accurate customs valuation, are more likely to earn the trust and loyalty of consumers. Brands like Patagonia and Unilever have gained recognition for their commitment to sustainability and ethical sourcing, which has helped them build strong brand reputations and customer loyalty. By valuing samples correctly, businesses can align with these trends and demonstrate their commitment to ethical practices.

Moreover, the COVID-19 pandemic has underscored the importance of resilience in global supply chains. The disruptions caused by the pandemic highlighted the vulnerabilities in supply chains, leading companies to reassess their sourcing strategies and logistics operations. In this context, the role of samples in testing new suppliers, materials, and products became even more critical. Valuing these samples accurately for customs purposes ensured that businesses could continue to innovate and adapt to changing market conditions without facing unnecessary delays or penalties.

Placing value on samples from abroad for customs purposes is not just a legal requirement but a strategic necessity in today’s global market. The expansion of international trade, the reach of e-commerce, and the complexities of global supply chains all underscore the importance of accurate customs valuation. By adhering to proper valuation practices, businesses can ensure fair competition, smooth customs clearance, and compliance with international trade laws. Moreover, valuing samples correctly aligns with broader market trends towards transparency, ethical consumption, and supply chain resilience. As the world continues to become more interconnected, the importance of accurate customs valuation will only grow, making it a critical aspect of global trade and business strategy.

Why should you ship with SindoShipping and how is our company able to help you and your business to ship your goods and products to Indonesia?

Our company vision is to help companies around the world to be able to export their products to Indonesia with ease and expand their market worldwide especially in South East Asia as Indonesia is the leading internet market and largest economy around the region and to help ease the process of importation to the country and we want to help millions of Indonesian to access products worldwide with effective shipping system.

With the proper documentation and brokerage, we are able to help our customers ship a few categories of goods which have limited restrictions to Indonesia without any hassle to the customers address directly as we understand the process and the regulation of the imports including the taxation process of imports.

SindoShipping specialized in electronics, high tech products, cosmetics, luxury branded, toys, supplement and vitamins, fashion, bags and shoes, and traditional medicine shipping to Indonesia since 2014 with the top accuracy of shipment service and the live tracking available during the cross border shipment so the customer can feel safe and secure about their shipping. Contact us now for further details at 6282144690546 and visit out site sindoshipping.com

Anymore question?? Do not hesitate to contact one of our staff or email to sindo.yl@gmail.com for further info. We are happy to answer some of your questions in regards to shipping to Indonesia. Sindoshipping – the best shipping service to Indonesia.