Customs Duty

Customs Duty in the UAE

Customs is a tax imposed on goods imported from international borders and is collected at the first point of entry of the GCC States. Customs in UAE operate under the Common Customs Law of the GCC states and other rules and regulations in line with the provision of International Agreements relating to Customs.

The customs duty rates on imported goods are fixed at Ad Valorem Terms i.e., the customs duty is calculated on a percentage of the CIF value of the goods, or on Specific duty wherein the import duty is calculated on a quantitative description of the goods. The customs duty in UAE on foreign goods originated and imported from non-GCC countries are:

1. 5% on CIF value of all foreign goods imported from outside of the Customs Union
2. Ad valorem or specific duty of 100% on value or quantity/ weight, whichever is higher, on tobacco and related products
3. 50% on Alcohol Products 

Businesses licensed by a competent authority in UAE or in the GCC states can register their business with the Customs Department specifying the type of business they operate. The company will be provided with a unique identification code upon registration, which is associated with the validity of the license.

Registered businesses need to file detailed customs declarations to clear the goods and approval from Tax Authority, wherever required, also needs to be submitted to the Customs Authority.

The Customs Authority conducts Customs Audit on all transactions to ensure compliance of Law. This audit can be initiated by the Customs Department or by the registered entity. Conducting regular audits will safeguard businesses from fines and penalties as all records would be reconciled.

All documents related to Customs Declaration are to be retained for a period of 5 years from the date of clearance. Customs may demand all the Declaration-related documents such as contracts, correspondence, and other relevant documents without having to accept all that is stated in the declaration or in the Invoices. However, the documents related to the Free zone Customs Declaration shall be required to retain until the economic operations are being carried out in free zones.