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30 Dec 2010
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RAC Carnet rip off
I have been looking (like lots of others I'm sure) at the UK Carnet multiplication factor.
As far as I can work out, in Egypt the maximum import tax is about 240%. I believe a Swedish Carnet reflects this at 235%. In the UK it is 800%.... FFS why ?
As for the other expensive countries, namely: Iran,Pakistan, India, Bangladesh and Nepal, which are charged at 500% by the RAC, I have done some research into their import duty rates. The results I have come up with are as follows. (The justification and references are at the bottom).
Iran, 100%
Pakistan, 120%
India, 102%
Bangladesh, 87%
Nepal, 94%.
Now I understand, in the event of a claim, there will be a lot of inflated fees to be paid, but how the extra 400% can be justified is beyond me.
It's nice if you can afford to tie up a large chunk of money at the bank and then still afford to actually travel but in reality, it boils down to insurance, namely Lloyds of London through R.L. Davidson (who also indemnify the ADAC in Germany).
On top of that is a clause that in the event of a claim, they will of course pay out, but Lloyds are fully entitled to claim back their losses from guess who....
This is what they say....
http://media.rac.co.uk/pdf/rac-private-prop.pdf
3. It must be clearly understood that this insurance guarantee, if taken up, does not relieve you of paying duty should the necessity arise. Lloyd’s Underwriters are entitled under the Indemnity to recover from you the amount paid. Our Guarantee merely enables you to take the vehicle out of Great Britain without having to freeze a lump sum in this country.
Makes you wonder what insurance realy is.
So why is it so expensive - the multiplier that is ?
In Germany a carnet for a ϵ15,000 bike (£12,800) for Egypt is ϵ3000
In the UK it is, for a £12,800 bike, 12k x 8 = £102.4k x 10% = £10,240 of which you get back £5,120 (ϵ6,000) if no claim is made.
Basically 4 times as much up front and 2 times as much when finished satisfactorily.
The Germans will take you to court for any losses they incur. The Brits (Davidsons) will take your money (as they are an insurance company ) then let Lloyds make their claim to you to recover their losses.
Is it worth it ????? or are we better of winging it with the exception of countries that will not let you in at all without a carnet, Kenya for example. As can be seen below many will allow entry at a fraction of the cost.
Nepal for example will allow motorcycles in without a carnet for 100 Nepalese Rupees per day, about £0.90 per day for up to 30 days, thereafter £4.50 per day, wheras a carnet will allow up to 6 months in a year.
Extorionate madness. Is someone in the upper echelon of the RAC married to a director of Davidsons or Lloyds.
This BTW is in no way meant criticize Paul Gowan at the RAC in any way as I understand from many posts that he is an extremely helpful guy but he does not set the rates.
Feel free to comment, I realy would love to be completely wrong...
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This is the best I can find for the various countries, some from government customs sites, some not. References and relevant data.
Iran – 100%
Ref Automotive industry in Iran - Wikipedia, the free encyclopedia
IMPORTS
Car imports have risen, from $184 million in 2002 to $1.5 billion in 2007. [23] In 2006, the government lowered the automotive import tariff levels to 90 percent for light weight vehicles and since then a huge influx of imported vehicles has been witnessed in the country. [17] The tariff level for import of heavy vehicles is even lower at 20 percent, due to low levels of local production and high demand.
Indicative listing of import tariff rates in 2006 [35] Item Tariff rate chemical products 10% ordinary metals 10% measurement instruments 10% medical equipment 10% food industry 15% mining raw production 15% leather industry 15% paper and wood fabrics 15% mechanical machinery 15% agricultural raw production 25% electric machinery 25% automotive vehicles 100%
Pakistan – 120%
Ref: http://www.mofa.gov.pk/Downloads/ImportofVehicles.pdf
This is for normal new imports. It is not possible for foreign nationals to improt used.
Assessed value is typically 140% of actual value as they include all shipping charges etc as part of the cost.
Say vehicle value of 1200 cc bike = £10,000 X 140% = £14000
Add duty £14,000 x 60% = £8,400
Add Sales tax (£14,000 + £8,400) x15% = £3,360
Add Income tax (£14,000 + £8,400 + £3,360) x 0.05% = £13
Add federal duty tax (£14,000 + £8,400) x 1% = £224
Total taxes for a £10,000 bike = £11,997 or 120% of original value
Type of veh, Customs Duty, Sales Tax, Tax on Sales Tax, Federal Duty
From 1001 CC to 1300 CC, 60.00%, 15.00%, 5.00%, 1.00%
India – 102%
Ref: http://www.chennaicustoms.gov.in/imports/car.htm
There is a sliding scale for used vehicles, 1 year 16%, 2 year, 28%
The present rate of duty on import of Car is as below:
Total effective duty works out to 101.91%, which includes the following.
BREAKUP OF CUSTOMS DUTY ON CAR IMPORT(2000-2001)
BASIC CUSTOMS DUTY
SURCHARGE ON CUSTOMS DUTY
ADDITIONAL DUTY
SPECIAL EXCISE DUTY
MOTOR VEHICLE CESS
SPECIAL ADDITIONAL DUTY OF CUSTOMS
Bangladesh – 87%
Ref: BANGLADESH Policies ( Exim Policy ) :: Trade in Bangladesh,Bids in Bangladesh,Tenders in Bangladesh,B2B Business in Bangladesh,Bangladesh Trade Gallery
Example:
1300 cc car, C&F value $ 10,000
Insurance (1% or actual) 100
Landing Charge (1%)1 100
Assessable value 10,200
a. customs duty @ 45% $ 4,590
b. supplementary duty @ 10% $ 1,020
c. duty paid value $ 15,810
-VAT at 15% of duty paid value 2,371.50
--advance income tax 2.5% of assessable value $ 255
--license fee 2.5% on assessable value $ 255
--total duties and taxes $ 8,491.50
Our $ 10,000 vehicle's landed cost is therefore $ 18,691.50.
Nepal – 94%
Ref: http://trade.gov/wcm/groups/internet...debarriers.pdf
NEPAL
An import license is required.
The import duty is levied at around 94 percent on public carriers and around 117 percent on mini-buses (customs duty of 25 percent on public carriers and 40 percent on mini-buses, 32 percent excise duty on the gross of Invoice Value plus Customs Duty, 1.5 percent local development tax on invoice value, 5 percent special tax on invoice value, and 13 percent value added tax (VAT) on the gross of invoice value plus additional duties and taxes).
The import duty on other vehicles is around 176 percent (80 percent customs duty, and additional duty and taxes as applicable on mini-buses and public carriers).
Ref: Normal Tariff
12. Special provisions relating to import of Vehicles:
…………
(2) Vehicles of personal use brought in by tourists under a carnet shall be allowed to stay in Nepal continuously or now and then for a period of 6 months during the span of 12 months (one Year) from the date of the first entry into Nepal without payment of import duty. Vehicles thus imported, if not taken back within six months, shall be ipso facto confiscated.
…………..
(3) The temporary importation of vehicles such as motorcars, station wagons, land rovers, jeeps, trucks, tractors, lorries, vans and motorcycles including their trailers except those brought under a carnet shall be charged customs duty as follows:
…………..
(b) Import duty shall be levied on vehicles, having no carnet, imported temporarily on the following rates:
…………
Motorcycles and Scooter Rs. 100 per diem, (About £0.90/ day– Dec 2010)
…………
Vehicles thus imported with the payment of temporary import duty shall not be permitted to stay in Nepal for more than 30 days in a year.
…………
(d) Vehicles and means of transport thus imported temporarily must be taken back. Vehicles specified in clause (a), (b) and (c) above may be seized if found to have overstayed from the period declared in the customs declaration form (Pragyapanpatra),
…………..
Nevertheless, vehicles may be allowed to be taken back after paying duty for overstayed period at the rate of Rs. 500/- per diem in the case of motorcycle
………………..
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Last edited by Old Git Ray; 30 Dec 2010 at 21:35.
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30 Dec 2010
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I agree its a complete rip off.
carnet for UK bike for Egypt 800% of the value
Carnet for SA bike for Egypt 200% of the value
what annoys me the most is how everyone on the forum says how friendly and helpful the RAC are - well i would rather them be rude but cheap
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31 Dec 2010
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Does the vehicle have to get the carnet from the country it's registered in ?
or due to the free trade agreement within the EEC can we shop around within those member states ??
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31 Dec 2010
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Quote:
Originally Posted by bushman_uk
Does the vehicle have to get the carnet from the country it's registered in ?
or due to the free trade agreement within the EEC can we shop around within those member states ??
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Going "by the book", you probably should get it from your country of residence. But 3,5 years ago I tried to apply the Carnet for Asia from the ADAC (I have a Finnish passport, and the bike´s registered in Finland). The answer was they forwarded me back to the Finnish AA, with the only exception being, if I needed a Carnet for Egypt. Which I didn´t.
The ADAC seemed cheaper than our AA at that time (handling fees were about the same, but the bond in Finland was 5000 euros, whereas with ADAC it could´ve been around 3000, if I remember the figures correctly - and I estimated bike value at 9000, I think, and 5000 was actually the minimum bond amount in Finland).
Maybe I gave up on ADAC too easy back then. f I needed that precious paper again, this time I´d probably try them a bit more persistently. I was left under the impression, that it´s not 100% impossible to get it from another country.
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31 Dec 2010
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Just had a browse over the ADAC web site and it does appear possible to use them
Carnet de Passages Englisch
http://www.adac.de/_mm/pdf/Carnet%20...isch_18337.pdf
It gives a selection of charges implying that you do not have to have a German registered vehicle.
On the last page of the pdf applocation form it asks for " certificate of location stamped by your customs authority"
I am going to give it a try in the new year a need a carnet for Japan and Iran . Any problems i shall let you know
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31 Dec 2010
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As far as I'm aware, you don't need a carnet for Kenya, you just pay a Temporary Impory Permit charge on the border, 25 dollars if I remember right, and then there is a road tax to pay, about the same again for a month.
If you have a carnet, you dont pay the T.I.P
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31 Dec 2010
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Quote:
Originally Posted by eightpot
As far as I'm aware, you don't need a carnet for Kenya, you just pay a Temporary Impory Permit charge on the border, 25 dollars if I remember right, and then there is a road tax to pay, about the same again for a month.
If you have a carnet, you dont pay the T.I.P
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How long ago was this as, unfortunately - this says otherwise:
KRA - Customs Services Department - Frequently Asked Questions
"For foreigners, a carnet de passage has to be obtained. This document is issued by the Automobile Association (AA) office in any country."
What the reality is, is anybodys guess. Anyone with recent personal experience ???
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31 Dec 2010
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Quote:
Originally Posted by bushman_uk
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Keep us posted. From what I have read, the AIT in Switzerland (who ultimately run the scheme) have directed that persons living in countries that have a participating Automobile Association, must use their own one. The site does appear to accept applications from other countries but unfortunately we may be stuck with our extortionate RAC.
Unfortunately their web site is 8 years out date and sucks - big time.
If you have any luck, I will be following in your footsteps.
Good Luck and Happy New Year
EDIT: Reading the attached instructions, it is apparent that you can only use a bank garuantee from a German bank. Not that it makes much difference to pay in cash (as you would need to do if you do not have a German acount), as you cannot do anything with the money anyway.
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Last edited by Old Git Ray; 31 Dec 2010 at 16:10.
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31 Dec 2010
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Insurance vs Bond?
Here in Canada we have recently been given the option of using the indemnification (insurance) method. The difference in cost compared to just putting up the bond is amazing. As I understand it from Suzanne Danis at the CAA they use the same insurance company as in the UK so the prices are the same. You can try out their handy calculator at:
Carnet de Passages en Douane - Cost Calculator - Canadian Automobile Association | Association canadienne des automobilistes
Too bad that the RAC doesn't allow you to simply pay the bond, which is the true import duties rather than using an insurance company's actuarial tables. With the bond you have to put up more money up front but you get 100% of it back, minus the processing fees.
For us Egypt was 55% of the value of the bikes, not 800%. I guess the insurance companies must have assessed that the risk of someone selling their bike in Egypt is relatively high. That is, they've been burned in the past.
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Nothing useful to add, of course it's a rip-off. That's what being British is about.
UK >>Insert product / service here<< Rip-Off.
Daniel
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This guy, Franconian, tried and failed in July this year (2010).
And he's a German (according to his profile) but would appear not to live there. It doesen't say where he does live though.
http://www.horizonsunlimited.com/hub...=german+carnet
"I just tried to get a carnet from ADAC. Unfortunately this is only possible for German, Netherlands or Denmark registered vehicles.
I thought I read here that many people with foreign registered bikes got their carnet from ADAC..."
Looks like we (the Brits) are stuck with the extortionists...
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Quote:
Originally Posted by Ekke
Here in Canada we have recently been given the option of using the indemnification (insurance) method. The difference in cost compared to just putting up the bond is amazing. As I understand it from Suzanne Danis at the CAA they use the same insurance company as in the UK so the prices are the same. You can try out their handy calculator at:
Carnet de Passages en Douane - Cost Calculator - Canadian Automobile Association | Association canadienne des automobilistes
Too bad that the RAC doesn't allow you to simply pay the bond, which is the true import duties rather than using an insurance company's actuarial tables. With the bond you have to put up more money up front but you get 100% of it back, minus the processing fees.
For us Egypt was 55% of the value of the bikes, not 800%. I guess the insurance companies must have assessed that the risk of someone selling their bike in Egypt is relatively high. That is, they've been burned in the past.
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The RAC do allow a bond, but for my new XT1200Z (to Egypt) it would be about £96k or about $150k
Anyway, I just did the insurance calculation and you get ripped off about 30% more than we do. I hate to say I but you just made me feel a bit better - sorry.
Edit: It is apparent that R.L Davidson have a tight monopoly on this, I wonder if our monopolies commision would be interested ! Or should I just shut up in case they pull out altogether ?
The sad truth is that they have no risk whatsoever as Lloyds will chase you for anything they pay out anyway - madness.
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31 Dec 2010
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Quote:
Originally Posted by Old Git Ray
The RAC do allow a bond, but for my new XT1200Z (to Egypt) it would be about £96k or about $150k
Anyway, I just did the insurance calculation and you get ripped off about 30% more than we do. I hate to say I but you just made me feel a bit better - sorry.
Edit: It is apparent that R.L Davidson have a tight monopoly on this, I wonder if our monopolies commision would be interested ! Or should I just shut up in case they pull out altogether ?
The sad truth is that they have no risk whatsoever as Lloyds will chase you for anything they pay out anyway - madness.
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Glad I could help!
I just did the calculation for a $20,000 bike to Egypt and using the indemnity option would cost $17,880 up front with a return of $7,440 when you get back for a total cost of $10,400. For putting up the guarantee yourself you pay $11,600 up front (55% of $20,000 plus the processing fee) and get $11,000 back for a total cost of $600. When we rode to Cape Town our highest fee was actually for Tanzania at 100% of the value of the bikes. It's unfortunate that the RAC doesn't allow you simply pay the actual guarantee, not the insurance company's assessed value of 800%. To the best of my knowledge only Canadians and Americans can use the CAA but it can't hurt to send Suzanne a note and ask.
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Quote:
Originally Posted by Ekke
Glad I could help!
I just did the calculation for a $20,000 bike to Egypt and using the indemnity option would cost $17,880 up front with a return of $7,440 when you get back for a total cost of $10,400. For putting up the guarantee yourself you pay $11,600 up front (55% of $20,000 plus the processing fee) and get $11,000 back for a total cost of $600. When we rode to Cape Town our highest fee was actually for Tanzania at 100% of the value of the bikes. It's unfortunate that the RAC doesn't allow you simply pay the actual guarantee, not the insurance company's assessed value of 800%. To the best of my knowledge only Canadians and Americans can use the CAA but it can't hurt to send Suzanne a note and ask.
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How did you go about putting up the fee ?
Was it actully at the border that you parted with all that money and got it back at the exit point ?
Perhaps you could give us the full story with all the little details. I ask, as Intend to go through Tanzania too.
Did you go through Kenya too, if so what happened there too.
Or perhaps you have scribed this previouly ?
Pretty Please
Edit: I just found the Tanzania Vehicle import Tax calculation, here http://www.tra.go.tz/documents/Motor...omputation.doc
For a 1200cc vehicle under 10 years old: Take the value, add 25% then add 5% then add 18% =1.55 value or 55% tax.
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I've just taken a look at the KRA website, and stand corrected on the carnet issue into Kenya - according to thier information, foreigners temporarily importing a car into the country do indeed need to obtain a carnet - more info here: KRA - Customs Services Department - Frequently Asked Questions
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