1. Types and rates of taxes imposed on imported used cars
The customs duty, individual consumption tax, education tax, VAT are imposed on imported used cars. A customs duty rate of the applicable tariff heading is applied accordingly by the classification based on the type and cylinder volume, etc. of the imported car, and an 8% customs duty is imposed on a regular sedan.
The individual consumption tax is imposed on the total amount of the taxable value and customs duty, and usually, a 5% individual consumption tax is imposed on a sedan with 2,000cc or less engine displacement volume and a 10% individual consumption tax on a sedan with more than 2,000cc engine displacement volume. The education tax is 30% of the individual consumption tax. The VAT is 10% of the total amount of the taxable value + customs duty + individual consumption tax + education tax.
2. Calculation methods for taxable values on imported used cars
The taxable value of a used car is calculated directly by the head of a customhouse based on the relevant information and the amount of imposed taxes is notified to the importer.
- A purchase statement, a contract(if auctioned, auction information, etc.), and supporting documents of payment
- A cover letter, a vehicle title, and a certificate of cancellation of vehicle registration, etc.
- If a car has been in an accident, a salvage title, and supporting document of repair and related receipts
- A payment statement related to transport costs(inland/sea transport costs, etc.), verified information on an insurance policyholder/non-policyholder
- Standard prices assessed by the Customs, list prices in blue books, etc., and auction prices on reliable auction sites, etc.