Value-added tax (VAT) is a tax levied on the value added to goods and services at each stage of production or distribution. When it comes to imported goods, VAT is calculated by adding the purchase price and customs duties, then applying a 10% tax rate.
Tax Calculation:
Taxable Price: (Product Price x Customs Exchange Rate) + Taxable Freight
Customs Duty: Taxable Price x Customs Duty Rate for the purchased product
Value-added Tax (VAT): (Taxable Price + Customs Duty) x 10%