As turbulence sets in from US President Donald Trump’s new and much-talked-about economic policy, companies are now resorting to various customs tricks, according to a report by the Financial Times.
Two notable hacks are gaining traction:
Tweaking supplier contracts to declare prices before the addition of middlemen's markups, thereby reducing the dutiable value.
Splitting payments into non-taxable services, such as advertising, which can lower costs by 20% or more.
However, given that these tactics clash with long-standing tax strategies, global corporations must tread lightly, navigating a fine line between evading tariffs and venturing into risky territory.
On April 2, Donald Trump announced "reciprocal" tariffs on imports from other countries. The baseline rate will be 10%, but for each country the tariff will be calibrated and will be half of what they charge companies importing US goods.
According to Trump, this will be a "declaration of economic independence" for the United States. The EU is subject to 20% tariffs.