Lane-based taxes and duties example
In the following example, two plants are available to source a product that is transferred to a warehouse. From the warehouse, two customers are served. Each customer has demand=500 units.
The refundable and non-refundable tax rates are shown in the graphic below:
Based on these values, the total tax is calculated as follows:
Sourcing from Plant 1:
|
Refundable Tax |
|
Import to Customer 1 |
|
Import to Customer 2 |
|
Export from Plant |
= |
Total |
|
|
|
($30 * 500) |
|
($0 * 500) |
|
($5*1000) |
= |
$10000 |
|
Non-Refundable Tax |
|
Import to Customer 1 |
|
Import to Customer 2 |
|
Export from Plant |
= |
Total |
|
|
|
($60 * 500) |
|
($90 * 500) |
|
($50 * 1000) |
= |
$125000 |
Total tax cost = $135000
Sourcing from Plant 2:
|
Refundable Tax |
|
Import to Customer 1 |
|
Import to Customer 2 |
|
Export from Plant |
= |
Total |
|
|
|
($30 * 500) |
|
($0 * 500) |
|
($150*1000) |
= |
$135000 |
|
Non-Refundable Tax |
|
Import to Customer 1 |
|
Import to Customer 2 |
|
Export from Plant |
= |
Total |
|
|
|
($60 * 500) |
|
($90 * 500) |
|
($40 * 1000) |
= |
$115000 |
Total tax cost = $250000
Last modified: Wednesday May 15, 2024