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ICS Objective
Governments lose both Tax and Customs revenues due to intentional under- and over-invoicing by the trading community. In countries where Customs revenues represent an essential component of government income, revenue loss can be substantial. According to the internal estimates of one Asian country, its losses from Customs fraud alone approaches US$ 5 billion annually. In general, public sector revenues in developed economies are more dependent on taxation such as VAT and income tax than on Customs revenues. For example, the total value of imports and exports to and from the United States is approximately US$ 1.3 trillion. Assuming a 10% rate of over-valuation on imports, a 10% rate of under-valuation on exports, and a corporate income tax rate of 40% the US Government stands to lose approximately US$ 50 billion in annual Tax revenues. The primary objective of ICS is to help Customs and Revenue Authorities enhance revenues from import duties and taxes through: - Price research - to identify cases of under- and over-invoicing.
- Inspection of goods at destination - to identify cases of misclassification of goods, and quality and quantity discrepancies that could lead to under-payments of duties and taxes.
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