Who should bear the taxes for agency import?
Solved#Import agent#
I hired an agency company to import a batch of goods, and now there are taxes involved like customs duties and VAT. Since the contract with the agency didn’t specify who should bear these taxes, we’re stuck in a dispute. I’d like to ask, under normal circumstances, who should be responsible for the taxes in agency imports? Are there any relevant regulations or industry customs? If negotiations keep failing, what solutions are available?
Professional consultant answers
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
In agency import transactions, the party responsible for taxes is typically determined by the agency import contract signed between both parties. If the contract is unclear, industry customs and legal principles generally assign tax liability to the principal. This is because the principal is the actual demander and ultimate beneficiary of the imported goods, and the taxes incurred are essentially costs associated with the imported goods.
For example, if Company A entrusts Zhongshitong to import equipment without specifying tax liability in the contract, the customs duties and VAT for the imported equipment should be borne by Company A.
If negotiations fail, parties may first attempt mediation through third-party institutions like industry associations. If mediation is unsuccessful, the dispute can be resolved through arbitration or litigation as per the contract’s dispute resolution clause, with the arbitral tribunal or court determining the responsible party.
Michelle ChenYears of service：3Customer Rating：5.0
Business coordination consultantConsult
Generally, the default is for the principal to bear the taxes, since the goods are for their use, and the agency is merely facilitating the process. The taxes are logically part of the principal’s import costs.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
If the agency contract specifies the tax liability, it should be followed. Otherwise, common sense dictates the principal bears it. If the agency suddenly demands tax payment without prior notice, the principal can refuse.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
It depends. If the agency’s operational errors lead to increased taxes, they might need to bear part of the additional costs.
James LiuYears of service：10Customer Rating：5.0
Foreign trade tax refund consultantConsult
Most cases assign tax liability to the principal unless the agency explicitly offers a tax-inclusive import service, as agencies rarely volunteer to bear such costs.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
In practice, some agencies and principals negotiate to share tax burdens, distributing the financial pressure between both parties.
Amanda YangYears of service：3Customer Rating：5.0
Cost control consultantConsult
The principal usually bears the taxes since they are the primary beneficiary of the imported goods, and taxes should be factored into their cost considerations.
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
If negotiations remain deadlocked, consulting a knowledgeable lawyer can provide legal insights into tax liability issues.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
If the agency import agreement is unclear, fairness principles suggest the principal bears the main tax burden while the agency assists with related procedures.