What is Value Added Tax (VAT)?

 VAT in full form stands for Value Added Tax. It is an additional tax on imported goods, applied at every step of the supply chain - from raw materials to manufacturing and the sale of goods. For VAT on imports, the VAT on shipping is based on the customs value of the goods.

The VAT rate varies by country, typically ranging from 7% to 20% of the product's value. Businesses in countries with VAT systems must register for a VAT number, which serves as an identification number for all VAT-related purposes.

It is applicable for importing goods into the European Union where the standard VAT rate is at least 15%. Do note that there is no VAT for the United States of America.

Before receiving the goods, the recipient can conveniently pay the applicable taxes online using FedEx tools like the FedEx Global Trade Manager.

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