Korea Customs Service Lowers Air Transport Tariffs on Core Car Parts and More

[Asia Economy (Daejeon) Reporter Jeong Il-woong] A temporary special measure will be provided to pay customs duties based on maritime transport standards when urgently transporting core automobile parts by air.

This is a government measure to support domestic companies facing difficulties in procuring Chinese-made parts due to the novel coronavirus disease (COVID-19).

According to the Korea Customs Service on the 20th, the government held an ‘Expanded Trade Strategy Coordination Meeting’ chaired by the Prime Minister at the Korea Trade Center on the same day and decided to promote export support measures with such content.

Previously, through on-site meetings, the government received complaints that when urgently importing core automobile parts by air, customs duties are imposed based on air transport costs, increasing the burden on companies.

Meanwhile, the domestic automobile industry experienced a sharp decline in wiring harness production in China due to the impact of COVID-19, leading to the suspension of operations at some factories since the 7th.

Accordingly, the government plans to revise the ‘Notice on the Determination of Taxable Price of Imported Goods’ by the Korea Customs Service within this month to temporarily impose customs duties based on maritime transport costs even for air transport when the transportation method is changed from sea to air or overseas suppliers are changed due to the impact of COVID-19, making air transport unavoidable.

Considering that air transport costs are generally at least 15 times higher than sea transport costs, this is intended to reduce the customs burden on companies.

In this regard, the Korea Customs Service plans to separately announce the eligible goods and application period recognized by the Commissioner of the Korea Customs Service on the 25th of this month. In addition, to provide practical help to importing companies, the special measure will be applied retroactively to goods declared for import from the 5th (the date of announcement of COVID-19 related tax and customs clearance support measures).

A Korea Customs Service official said, “The government will continue to strive to minimize the impact of COVID-19 on our economy,” and added, “Above all, we will focus administrative efforts on operating an emergency response system and actively reflecting the voices from the field.”