Definition
A bonded warehouse is licensed warehouse in the country where imported goods/products can be stored without paying import duties and taxes. It’s important to note that bonded warehouses are either managed by the state or licensed to private individuals and companies. However, they need to ensure compliance for maintaining and sustaining their license with the Government.
Understanding bonded warehouse
Suppose you have imported goods in the country. However, you do not intend to use these goods but dispatch them to another country. So, it’s viable to keep your goods in the bonded warehouse under such circumstances.
The greater advantage is that you will not be liable to pay tax as goods have not been technically imported into the country. However, the rent of the warehouse is payable. Further, if you want domestic use goods, an import duty must be paid.
It’s equally important to note that taking care of your goods is the responsibility of bonded warehouse while it’s stored there. Further, these warehouses have sophisticated storage facilities for goods that require cold storage and some special treatment.
Purpose of bonded warehouse
The purpose of a bonded warehouses is to store goods on import. The products can only be released for domestic purposes once the importer has paid import taxes and duties. However, an alternate approach can be to export in another country.
Types of bonded warehouses
There are three main types of a bonded warehouse that include following,
- Public bonded warehouses (Type B)
- Private bonded warehouses (Type C)
- Customs warehouse (D and E)
1- Public bonded warehouses are open for all importers in the country. These are owned/licensed by the state. Further, they need to comply with regulations set by customs authority.
2-Private bonded warehouse are built for the administration of private companies/people. They can keep and store their goods. Further, they can also store imported goods of others. However, they need to comply with certain regulations.
3-Customs warehouses are allowed to store and keep goods for administrators only.
Conclusion
A bonded warehouse is a warehouse where imported goods are stored. These goods can be released if the importer pays taxes in the importing country. Similarly, in the case of export, such goods are released from bonded warehouses.
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