According to method 5, the costs of production of imported goods are considered and their cost is calculated on this basis. To determine the customs value using this method, information on the production costs of the estimated goods is required, which can be obtained only outside of Russia.
As a rule, the manufacturer of the goods being evaluated is outside the jurisdiction of the Russian Federation, and therefore the use of this method in practice is limited to those cases in which the parties to the transaction are interdependent persons and the manufacturer is ready to submit to the customs authority of the Russian Federation the necessary data on production costs.
These data should be based on information related to the production of the goods being evaluated and submitted either by the manufacturer or on his behalf. The information should be based on its commercial reports, provided that they comply with generally accepted accounting standards and principles applied in the country of the manufacturer.
Inthe customs value of the goodsAccording to Article 23 of the Law, the following components are subject to inclusion.
a) The cost of materials and costs incurred by the manufacturer in the production of the evaluated goods.
Materials in this case are understood as:
The cost of materials does not include internaltaxescountries of production, if they are subject to return when exporting finished products.
Production costs should include:
In the composition of materials and costs in accordance with Part 1 of Article 19 of the Law, the following elements to be included in the customs value must also be taken into account:
b)The amount of profit and the amount of total costs characteristic of the sale for export to the Russian Federation of goods of the same type by their manufacturers,including the costs of transportation, loading and unloading, insurance and other costs to the place of importation into the customs territory of the Russian Federation.
Total costs in this case represent direct and indirect costs of production and sale of goods in the Russian Federation, which were not listed as part of the costs noted above (p.but).
The amount of profit and total costs should also be determined on the basis of information provided by the manufacturer, and be determined according to generally accepted accounting principles.
c) The profit usually received by the exporter as a result of the delivery of such goods to the Russian Federation.
As a confirmation of the customs value declared by the declarant according to method 5, it is necessary to have an appropriate documentary confirmation of all the listed elements. If the information is provided by the manufacturer, it can only be confirmed in the country in which he agrees to such confirmation. This imposes a strict restriction on the use of the cost addition method. If unconfirmed data is presented to the customs authority, this should be considered as unsubstantiated data, not necessarily reflecting the actual state of affairs.
All these difficulties make the application of method 5 in practice extremely rare.