VAT Director Rayner Essex
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Build-A-Bear Workshop

Build-A-Bear customs duty: Grin and bear it


A recent Upper Tribunal case concerning the high street retailer Build-A-Bear and Commodity Codes demonstrates the complexity of importing and level of detail required to ensure a business is using the correct commodity code.

23rd Apr 2021
VAT Director Rayner Essex
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Commodity Codes determine what, if any, import duties are applicable and the imposition of the incorrect import duty can eat into margins or create unexpected retrospective surprises like this case.

If nothing else, the idea of a room filled with highly intelligent and experienced QC’s on both sides presenting arguments as to whether a cardigan designed to be worn by a teddy bear is an accessory or a toy brings a wry smile.

Bear with me: background

For those not familiar with the retailer, the store offers a unique experience, customers select from a variety of teddy bears and dolls, they can personalise their bears and dolls with accessories including clothing, wigs, shoes, glasses, crowns and sports equipment.  

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Replies (2)

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By vstrad
26th Apr 2021 14:22

Couldn't we just use our newly taken back control to devise a system that doesn't require this ridiculous degree of nit-picking?

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Replying to vstrad:
Jason Croke
By Jason Croke
29th Apr 2021 11:26

Commodity codes have always existed, albeit it only mattered when importing goods from non-EU Countries, and in this specific case, the goods were being imported from non-EU sources and so it's not really a Brexit related case.

The Brexit link is that the same nuances on display in this case will apply to all imports, whether from EU or rest of the world.

The commodity codes are a global WTO thing, so as good as the UK is at going its own way on things, having to redefine an entire set of globally accepted commodity codes could be a challenge. It may be easier to enter into free trade agreements with trading partners, but then as import duty is both a revenue raiser and a protector of domestic economies, that is easier said than done.

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