Customs processing fees costing Icelanders more than actual import duty

The recipients of 36,000 parcels from overseas last year had to pay Icelandic Customs more for deciding how much duty and charges to apply to their packages than they did for the actual duty and charges themselves.

This revelation about the unpopular and very high charges levied against foreign parcels (including those from websites like eBay and Amazon) came in a parliamentary answer given by Minister of the Interior, Ögmundur Jónasson. The question was asked by Social Democrat MP Mörður Árnason, RÚV reported.

It was revealed in the Alþingi parliament that the recipients of the one thousand cheapest parcels had to pay an average of 18-times more in processing fees than they did in actual import fees. The import fees in question are import duty, standard Icelandic VAT and a charge applied to imported goods; but there is also a fee applied to cover the cost to the Customs agency of deciding how much those charges should be for each package received.

The parliamentary enquiry asked for specific details on postal services from overseas; including the number of parcels received and how much money was charged for them. In the answer it was revealed that the 1,000 cheapest parcels received had an average import charge of ISK 30 (EUR 0.19) last year, but that recipients were charged ISK 549 (EUR 3.43) each for assessing how much the import charge would be.

The next 2,582 cheapest packages received after that had an average tax of ISK 81 (EUR 0.51) added — or one seventh the amount charged to recipients for finding that out. A further 15,000 parcels were charged an average of ISK 180 (EUR 1.12) duty — but three times more in handling fees.

Overall last year Icelandic Customs charged people receiving parcels from overseas ISK 216 million (EUR 1.35 million) in tax and import charges, and a further ISK 64 million (EUR 400,000) in handling fees. The handling charges for deciding what charges to apply to parcels netted Customs ISK 3 million (EUR 18,739) profit last year; but were ISK 9 million (EUR 56,214 at today’s rate) short of covering costs the year before that.

Charges applied are variable and sometimes hard to predict; but anecdotal evidence suggests that customers in Iceland buying from sites like Amazon often count on paying roughly the same to receive their parcel as they did to buy it. Icelandic Customs work out their charges based on the total amount paid, including foreign VAT and postage & packing. One IceNews reader recently emailed to complain that she had bought a book online for GBP 0.01; but that once the GBP 5 in postage & packing was included, Icelandic Customs charged her a further GBP 4 (or ISK 750 / EUR 4.68) to receive the book.

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