Proposed US tariffs on lenses from Germany

[Chuck Albertson]

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1 hour ago, Herr Barnack said:

I wasn't asking just you - I was asking all 7.7 billion inhabitants of this planet, hoping against hope that someone has an answer that actually makes some sense.

Upon further reflection, I now realize that hoping to make sense out of said load of Byzantine bureaucratic hogwash was hopelessly unrealistic on my part.

Well, one other thing I noticed in the filing is the proposal to charge tariffs on a wider range of imported aircraft, including helicopters. Also aircraft parts and components, including fuselage assemblies and wings. The last bit seems squarely pointed at the Airbus plant in Alabama that is assembling the A220 regional jet from parts imported from the EU (the wings are made in Belfast). Even though it doesn't compete in the RJ market, Boeing kicked up a fuss about this plane being sold below cost when it was the Bombardier CS100 (and I must say, the nicest RJ I've flown on), and persuaded the Commerce Department to impose tariffs of nearly 300 percent on it at the end of 2017. The US International Trade Commission later reversed the DoC tariff order, and Airbus decided to obviate the matter by buying the RJ line from Bombardier and opening the final assembly plant in Mobile.

The October 18 list includes imported aircraft above a certain size. The tariff on those is 10 percent, instead of the 25 percent charged for everything else on that list. It was going to be 25 percent, but the American carriers that are buying Airbus beefed about it.

The basis for the rest of the stuff on the list beggars belief.

[Chuck Albertson]

The US Trade Representative announced revisions on February 14 to the tariffs on EU products, originally imposed on October 18, 2019 in response to the WTO ruling on Airbus subsidies. The 25 percent tariff on photographic lenses from Germany remain. The 10 percent tariff on imported EU aircraft is increased to 15 percent. You'll be delighted to hear that they dropped prune juice from the agricultural products subject to a 25 percent tariff. Apparently, the prune juice lobby has more juice than Leica dealers. Oh, and German and French butcher/kitchen knives are now subject to the 25 percent tariff. Full text of the notice here:

https://ustr.gov/sites/default/files/enforcement/301Investigations/Notice_of_Modification_of_Section_301_Action_Enforcement_of_U.S._WTO_Rights_in_Large_Civil_Aircraft_Dispute.pdf

Edited February 15, 2020 by Chuck Albertson

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[jdlaing]

That’s okay. I prefer Shun knives over Wusthof anyway.

[bherman01545]

All;

I recently purchased a used camera lens for a Leica SL from a reputable camera dealer in the Netherlands for a good price. The final destination was the USA, so Netherlands-->USA

The seller shipped the lens FedEx Express. FedEx in Memphis, TN called me to confirm my address only. I had asked if there were any duty charges, and the representative said she didn't see any.

Well, I got my bright and shiny used lens, and a week later, FedEx automatically, and without my consent, deducted $1121.52 from my bank account, which amounts to a 25% tariff. 

Should this apply to items imported from the Netherlands, or does it not matter, since the description is lens (objectiv) of metal and glass originating from Germany? They (FedEx or Customs assigns the closest code) and the buyer is on the hook for any and all tariffs.

I'm disputing the charges with FedEx and my bank, and the seller said that I can return the lens (shipping is charged to him) but I need to take my grievance up with FedEx and Customs. I'm wondering if I can get my duties paid refunded?

What a mess. Moral of the story, don't take a chance. Buy from within your country.

[NigelG]

I thought the import duties related only to new goods not used....

You can contact CBP at the port of entry (details on their website) for clarification/determination of duty I think -

"CBP makes the final determination of what the correct rate of duty is, not the importer. For very specific duty information on a particular item you may request a Binding Ruling. You may also receive guidance by calling your local CBP port."

Interestingly for Memphis there is an additional contact number...

Federal Express Contact - All inquiries and information dealing with processing of Federal Express shipments can be made by calling the Port office at (901) 480-4800between 8:00 a.m. and 5:00 p.m. 

I looked into this (for NYC) as I was ordering from HK. In the end I bought a body but no lens.

[wattsy]

I don't think it makes any difference whether the item is used or new. If it did, there would be all kinds of wheezes created to circumvent the duty.

[bherman01545]

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The whole thing is a big joke - and the joke was on me - unfortunately.

Again, US buyers (when buying Leica gear) should NOT buy from international dealers right now, for this exact reason, unless they (the dealer) agree to absorb the duties/tariffs.

[NigelG]

1 hour ago, wattsy said:

I don't think it makes any difference whether the item is used or new. If it did, there would be all kinds of wheezes created to circumvent the duty.

Well that's good to know - I was just looking at a lens from MeisterCamera...

It seems a little unfair given that the original purchaser in the NL paid 19% (?) BTW on the purchase price. At least with new goods they can be exported net of VAT so a lens from say Norway (25% tax) would end up the same overall price once US Duty is added. Since it's only on German lenses do Zeiss (usually manufactured in Japan) and Leica TL lenses (ditto save 35+60) escape the tariff?

 

[Exodies]

The dealer should pay the tarrif? I thought you guys were dead keen on no taxation without representation.

[bherman01545]

12 minutes ago, Exodies said:

The dealer should pay the tarrif? I thought you guys were dead keen on no taxation without representation.

Well, that is already taken care of - It's called a "Trump Card"

 

[bherman01545]

19 minutes ago, NigelG said:

Well that's good to know - I was just looking at a lens from MeisterCamera...

It seems a little unfair given that the original purchaser in the NL paid 19% (?) BTW on the purchase price. At least with new goods they can be exported net of VAT so a lens from say Norway (25% tax) would end up the same overall price once US Duty is added. Since it's only on German lenses do Zeiss (usually manufactured in Japan) and Leica TL lenses (ditto save 35+60) escape the tariff?

 

It is unfair, but according to FedEx Duties and Taxes as well as US Customs (I already called them and spoke with them both)

This is the criteria:

• The item must be declared for more than $1000US (less than $1000US) is usually duty free
• The item would need to be manufactured in Germany
• It doesn't matter if the item is new or used
• It makes no difference which country it is sold from or shipped from
• It does not matter if taxes were paid ten times at point of entry in other countries

If an item is > than $1000US, was manufactured in Germany, and fulfills the specifics in the tariff sheet, then the item would be assessed +25%, plus paperwork processing fees at the point of entry.

I would NOT buy any German cameras, lenses etc. from outside the US for more than $1000, unless the duties are paid by the seller

In my case, the seller wasn't keenly aware of this, nor was FedEx, as they claimed that the declared value, item description, as well as country of manufacture determines the duties/tariffs.

This is new to everybody, but as they say: caveat emptor

 

[wizard]

vor 3 Stunden schrieb bherman01545:

... don't take a chance. Buy from within your country.

Which probably will not help much, as the US importer will then have to pay import duties and will likely not be able to absorb them. So in the end, the customer will pay those import duties anyway.

[willeica]

47 minutes ago, wizard said:

Which probably will not help much, as the US importer will then have to pay import duties and will likely not be able to absorb them. So in the end, the customer will pay those import duties anyway.

The end consumer or user always pays all of the taxes. This is a fundamental principle of taxation which applies everywhere.

3 hours ago, bherman01545 said:

 

Again, US buyers (when buying Leica gear) should NOT buy from international dealers right now, for this exact reason, unless they (the dealer) agree to absorb the duties/tariffs.

See above. There is no chance of this happening. International dealers would soon go out of business doing this.

William

[pedaes]

1 hour ago, bherman01545 said:

It is unfair, but according to FedEx Duties and Taxes as well as US Customs (I already called them and spoke with them both)

This is the criteria:

• The item must be declared for more than $1000US (less than $1000US) is usually duty free
• The item would need to be manufactured in Germany
• It doesn't matter if the item is new or used
• It makes no difference which country it is sold from or shipped from
• It does not matter if taxes were paid ten times at point of entry in other countries

If an item is > than $1000US, was manufactured in Germany, and fulfills the specifics in the tariff sheet, then the item would be assessed +25%, plus paperwork processing fees at the point of entry.

I would NOT buy any German cameras, lenses etc. from outside the US for more than $1000, unless the duties are paid by the seller

In my case, the seller wasn't keenly aware of this, nor was FedEx, as they claimed that the declared value, item description, as well as country of manufacture determines the duties/tariffs.

This is new to everybody, but as they say: caveat emptor

 

Presumably the local vat of 19-21% that we locals pay was deducted, and replaced by 25% US tax.. If you were trying to avoid all taxes then a risk.  Bottom line, does the total you paid represent good value?

[wizard]

vor 11 Minuten schrieb willeica:

The end consumer or user always pays all of the taxes. This is a fundamental principle of taxation which applies everywhere.

William, the principle you refer to does not always apply. Remember the time when e.g. Italy and Denmark had a stiff luxury tax on cars? To avoid prices to skyrocket, car manufacturers sold their cars to Italian and Danish dealers, respectively, at much lower prices before tax than for example in Germany. This made clever people from other EU countries buy cars in Italy or Denmark (luxury tax would only apply when the car were registered in Italy or Denmark, respectively, and resell them (with a profit, of course) in for example Germany at a much lower price than what a German resident would have had to pay at its local dealership. Car manufacturers obviously didn't like that, but did not take the most obvious countermeasure, which would have been to raise prices before tax to the level of the other EU countries. 

This goes to show that if the profit margin is high enough, manufacturers may be willing to cut their profit margin somewhat to stay in business, resulting in the fact that at least part of an applicable tax or duty may be payed by the manufacturer, and not by the end consumer. It remains to be seen whether Leica will follow that path in US or not.

[pedaes]

30 minutes ago, wizard said:

It remains to be seen whether Leica will follow that path in US or not

They have plenty of margin to play with.

[NigelG]

57 minutes ago, pedaes said:

Presumably the local vat of 19-21% that we locals pay was deducted, and replaced by 25% US tax.. 

Local VAT can’t be deducted from used goods AFAIK only on new goods (where it is not actually deducted but instead not charged on the base price.

[willeica]

25 minutes ago, wizard said:

William, the principle you refer to does not always apply. Remember the time when e.g. Italy and Denmark had a stiff luxury tax on cars? To avoid prices to skyrocket, car manufacturers sold their cars to Italian and Danish dealers, respectively, at much lower prices before tax than for example in Germany. This made clever people from other EU countries buy cars in Italy or Denmark (luxury tax would only apply when the car were registered in Italy or Denmark, respectively, and resell them (with a profit, of course) in for example Germany at a much lower price than what a German resident would have had to pay at its local dealership. Car manufacturers obviously didn't like that, but did not take the most obvious countermeasure, which would have been to raise prices before tax to the level of the other EU countries. 

This goes to show that if the profit margin is high enough, manufacturers may be willing to cut their profit margin somewhat to stay in business, resulting in the fact that at least part of an applicable tax or duty may be payed by the manufacturer, and not by the end consumer. It remains to be seen whether Leica will follow that path in US or not.

Cutting profits or prices is different to paying taxes. Lenses going in to the US would still be subject to tax either at the point of import or by the final receiver of the goods. So any taxes due in the US would effectively be paid by the final consumer. Leica or international dealers might have some explaining to do with their customers in other countries as to why US customers were getting more favourable treatment and, before somebody denies this, it would be more favourable treatment. I am aware of customers crossing borders in Europe (particularly in Switzerland) to buy cars, but such 'loopholes' have usually been shut down before trade got too distorted.

I agree with Keith (pedaes) that Leica and its dealer network have considerable margin to play around with, but such price discrimination would be playing with fire with all of the other things coming down the tracks eg the 'B' thing. In the US, people happily accept the fact that goods are advertised net of State and local taxes, whereas in Europe this would be an illegal practice. I should know this as I used to enforce laws relating to such matters at one time in my life.

William

 

[wizard]

vor 4 Minuten schrieb willeica:

Leica or international dealers might have some explaining to do with their customers in other countries as to why US customers were getting more favourable treatment

Now, that would be easy, as Leica could always (and rightfully) say that US customers do not get more favorable treatment (since the end price a US customer has to pay will likely be higher than elsewhere, due to the 25% import duy).

vor 4 Minuten schrieb willeica:

but such 'loopholes' have usually been shut down before trade got too distorted.

It was called the grey market and went on for years (I did not check recently, but it may still continue).

vor 5 Minuten schrieb willeica:

In the US, people happily accept the fact that goods are advertised net of State and local taxes,

That may be true, but even in the US the advertised price would include the import duty, as the latter will have been paid by the importer before the item is sold on the US market.

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[bherman01545]

All good input, but we've gone a bit off topic here without respect to my issue. My recent issues relate to a used lens, being sold (not be Leica) but a third party dealer and shipped from the EU to the US and charges of +25% duty/tariff because of its classification and place or origin based on the new laws which have been put in place.

This post is not just to vent, but to warn others to not fall into the same trap by buying used and having it shipped into the US from abroad and hoping to save some money

 

-Brad