Planning to import textile machinery through an agent and want to know the specific import tariff values, differences in tariffs for different types of equipment, and calculation methods to budget costs in advance. The best answer points out that import tariff rates for textile machinery are not fixed and vary by equipment. For example, knitting machines generally have an 8% tariff, weaving machines around 9%, with a 13% VAT for all. The calculation method is: tariff amount = dutiable value × tariff rate.
In agency export business, who should receive the tax refund?
Resolved
Our company plans to use an agent for export and wants to know who actually receives the tax refund in this business model. Is it the principal or the agent? Are there any special circumstances involved, such as the parties signing a special agreement, which would change the attribution of the tax refund? Please help answer this, thank you!
Trade Expert Insights Answers
Kevin HuangYears of service：3Customer Rating：5.0
E-Commerce Export AdvisorStart a Chat
In agency export business, the tax refund is generally received by the principal. This is because the principal is the actual exporter and seller of the goods, bearing the production and procurement costs. Export tax refunds are essentially the refund of input tax contained in exported goods, so the principal is rightfully entitled to receive the tax refund.
However, if the principal and the agent sign a special agreement, the attribution of the tax refund may be executed according to the agreement. For example, the principal may agree to transfer part or all of the tax refund to the agent based on other value-added services provided by the agent. However, such an agreement must be clear and legal to avoid subsequent tax risks and legal disputes.
Regardless of the situation, relevant tax laws and export tax refund policies must be followed to ensure compliance.
Thomas LiYears of service：7Customer Rating：5.0
Import Licensing AdvisorStart a Chat
Typically, the principal receives the tax refund because they are the actual export operating entity. However, if the agent contributes significantly to facilitating the export business, and both parties agree to give the agent a portion of the tax refund, that is also acceptable, but the agreement should be clearly written.
Robert TanYears of service：5Customer Rating：5.0
International Market Development AdvisorStart a Chat
Normally, the principal receives the tax refund, as the costs related to the exported goods are borne by the principal. However, if the agent advances funds for the procurement of goods, and the agreement stipulates that the tax refund belongs to the agent, then it shall be handled according to the agreement.
David ChenYears of service：10Customer Rating：5.0
Trade Compliance AdvisorStart a Chat
Generally, the principal receives the tax refund. However, if the agent provides high value-added services, and the parties clarify the distribution of the tax refund in the contract, then it shall be executed according to the contract, to avoid disputes later.
Daniel KimYears of service：4Customer Rating：5.0
Commodity Inspection and Quarantine ConsultantStart a Chat
In principle, the tax refund goes to the principal, but if there is a written agreement between the parties regarding the distribution of the tax refund, it shall be handled according to the agreement. In any case, there must be clear written evidence.
Richard WuYears of service：8Customer Rating：5.0
Global Trade Operations ExpertStart a Chat
In most cases, the principal receives the tax refund. If the agent has made significant upfront investments, the parties can negotiate the distribution of the tax refund. The key is that the agreement should be detailed and free of loopholes.
Anthony LuoYears of service：10Customer Rating：5.0
Trade Compliance ExpertStart a Chat
Normally, the principal collects the tax refund. However, if the agent assumes additional responsibilities in the tax refund processing, the attribution of the tax refund can be adjusted after negotiation between the parties.
Michael ZhangYears of service：10Customer Rating：5.0
Customs Clearance SpecialistStart a Chat
Generally, the principal receives the tax refund. If the agency export agreement has specific instructions regarding the attribution of the tax refund, then it shall be handled according to the agreement, and business should be conducted in accordance with the rules.
Olivia LiuYears of service：6Customer Rating：5.0
Foreign Exchange Risk ManagerStart a Chat
The principal is usually the recipient of the tax refund. However, if the agent reaches a special consensus with the principal regarding the tax refund and it is written into the contract, then it shall be handled according to the contract.
Emma ZhaoYears of service：3Customer Rating：5.0
Export Documentation SpecialistStart a Chat
By default, the principal receives the tax refund. If the principal and the agent have a special agreement, such as the agent helping to reduce export costs, a portion of the tax refund can be agreed to be given to the agent.