The Chinese government has taken few stern steps promulgated a series of new regulations affecting companies that import and export taxable goods and services in China. The regulation is formulated for the purpose of safeguarding State sovereignty and national interests, strengthening supervision and control by the Customs, promoting exchanges with foreign countries in economic affairs, trade, science, technology and culture, and ensuring socialist modernization.
Customs offices are set up by the State at ports open to foreign trade and at places where concentrated Customs operations are required for supervision and control. The subordination of one Customs office to another shall not be restricted by administrative divisions.
The Customs offices exercise their functions and powers independently in accordance with law and are accountable to the General Customs Administration. Companies importing products from, or exporting products to, China will generally come into contact with the following three types of taxes:
- Value-added tax
- Consumption tax
- Customs duties
The Chinese government has clarified the import items into three categories: First- Prohibited (toxics, wastes), Second- Restricted (selected products that require quotas or licenses), Third- Permitted (most goods fall under permitted categories).
Over the years it has been noted that many US and European companies face immense problem by the Chinese custom department. Legal hassles are quite common incidents that foreign businesses face and come quite often to the China lawyers for possible remedies. Here are few tips shared by the professional China lawyers to avoid custom related problems.
- The very first thing you need to do is stop trying to dupe China customs by under-reporting the amount of good you are exporting here. If your website says you sell your widgets for USD$2000 and you declare their value with China customs at USD$500, you will get caught. The only thing that can save you if you are able to prove the product just looks the same as the one on your website, but it isn’t. Otherwise, if you are going to furnish the excuse that just because everyone does it, you did it, then you are in massive problem.
- When China customs coming after you, it is certain that they have ample evidence against you on the basis of which they are going to criminally prosecute you. The best defense against this situation is to stay calm and hire a good China lawyer.
- In the case you have really broken custom related laws of China, the best option is to confess the act and restrain from claiming innocence. The reason of admitting the fault is generally China goes much easier on those who confess.
While doing business in China, be sure you are not taking any unethical approach. If you unwittingly caught for any wrongdoing in China, take help from the experts.