Establishing the Customs Value

This page provides information about the valuation methods used to derive the Customs value of both new and used dutiable motor vehicles.

The Customs value is used to calculate:

• Excise duty, and

• Goods and Services Tax (GST).

New Motor Vehicles

Transaction Value Method

Singapore Customs first considers the Transaction Value Method.

This is based on the Cost, Insurance and Freight (CIF) value under the agreed incoterms.

Start with the price paid or payable, then add all charges necessary to sell and deliver the vehicle to Singapore, including:

• Selling commissions

• Assists (e.g. materials supplied by the importer)

• Packing costs

• Royalties and licence fees

• Freight charges

• Insurance charges

• Any proceeds from resale that go to the seller

Foreign Currency Conversion

If any component is in a foreign currency, convert it to Singapore Dollars using the prevailing weekly average MAS exchange rates at the time duty/GST is paid.

Company A buys a new car from Supplier B on EXW (Ex-Works) incoterms.

Example:

Total Customs value = 20,000 + 300 + 100 + 500 + 100
= S$21,000

Conditions for Using the Transaction Value Method

Singapore Customs may apply this method only if all conditions below are met:

1. There must be evidence of a sale.
   
   Examples of valid documents include:

   • Commercial invoice

   • Sales contract

   • Purchase order

2. There must be no restriction on the buyer’s use of the goods.

3. The sale is not subject to conditions that may distort the value.
   
   For example:

   • The seller sets the price on condition that the buyer also purchases other goods.

   • The price of semi-finished goods is set on condition that the buyer supplies a portion of the finished goods back to the seller.

4. The relationship between the importer and supplier must not influence the transaction value.

Other Valuation Methods

If the transaction value cannot be used, the following alternatives will be used to determine the Customs value:

1. Identical or Similar Goods Value
   
   Based on the transaction value of identical or similar goods sold for export to Singapore.

2. Deductive Value
   
   Based on the sellling price of the goods in Singapore, adjusted for costs incurred after importation.

3. Computed Value
   
   Based on:

   • Production cost

   • General expenses

   • Profit in the country of origin of the imported goods

4. Residual Valuation
   
   Based flexibly on the principles of other valuation methods

Used Motor Vehicles

The Customs value depends on how the used vehicle was acquired.

Scenario A: Individual owner purchased and used a vehicle in the country of export before importing into Singapore

Depending on the age and condition of the vehicle, Singapore Customs may apply depreciation to the original purchase price.

The Customs value includes:

• Depreciated purchase price

• Freight charges

• Insurance

• Other incidental costs needed to deliver the vehicle to Singapore (e.g., handling, storage)

Foreign Currency Conversion

Convert foreign currency amounts using the weekly average MAS exchange rates at the time Customs duty or excise duty is paid.

Scenario B: Individual owner or a company importing used vehicles that are purchased from other dealers prior to import

The Customs value is determined the same way as for new vehicles, using either:

• Transaction value method (if applicable), or

• Alternative methods listed above.