September 19, 2026

Why Customs May Not Accept Your Invoice Value

A thick stack of invoices and receipts seen close up, representing the paperwork that supports a declared customs value

You paid your supplier 8,000 dollars. The invoice says 8,000 dollars. Your agent calls to say customs has assessed the shipment on a higher figure, and your duty has gone up accordingly.

Your first thought is that someone has made a mistake, or that something improper is happening. Often neither is true. Customs is applying a valuation framework that most importers have never been shown, and which does not automatically treat your invoice as the final word.

Understanding it will not always change the outcome. But it tells you what evidence actually matters, and what to ask for when you disagree.

What duty is charged on

Duty is not charged on the price of the goods alone. It is charged on an assessable value, which is built up from the price plus the cost of getting the goods to the port of import, so freight and insurance form part of it. Our guide to import duties and taxes covers how the rates then apply on top of that figure.

Alongside the price you paid, the valuation rules require certain other things to be included where they apply, including commissions and brokerage other than buying commission, the cost of packing and packing materials, royalties and licence fees related to the goods, and payments you make indirectly in connection with the sale.

That last category catches importers out. If you pay part of the price separately, or settle something on the supplier's behalf, it does not stop being part of the price simply because it is on a different piece of paper.

The default is your invoice, until it is not

The starting point is the transaction value: the price actually paid or payable for the goods. Bangladesh applies the valuation framework of the WTO Customs Valuation Agreement, implemented through valuation rules issued in 2000, which follow the same structure used by most trading countries.

The framework allows customs to set the declared price aside in defined situations rather than at will. Broadly, transaction value may be rejected where:

The buyer and seller are related and the relationship influenced the price
There are restrictions or conditions attached to the sale that make the price impossible to assess properly
The price is not the sole consideration for the sale
Customs has doubts about the truth or accuracy of the declared value

That fourth one is where most ordinary disputes live. It is not an accusation by itself; it is a starting position that you are expected to be able to answer with evidence.

What customs uses instead

If the declared value is set aside, the rules do not allow customs to invent a figure. They prescribe a sequence, applied in order:

Method 1, identical goods: the transaction value of identical goods previously imported
Method 2, similar goods: the transaction value of similar goods
Method 3, the deductive method: working backwards from the selling price in the importing country
Method 4, the computed method: building up from production cost plus profit
Method 5, the fallback method: a reasonable value consistent with the principles above

Two details are worth knowing. The order is mandatory, so customs should not jump to a convenient method. And the importer may ask for the deductive and computed methods to be taken in the reverse order, a choice that belongs to the importer rather than to the customs officer.

In practice, the method you will meet is the first one. Customs services keep records of values previously accepted for the same kind of goods, and a declared price well below those records is the usual trigger for a query.

Why an honest low price still gets questioned

This is the frustrating part for legitimate importers, and it is worth being clear about.

A price can be genuinely low for reasons that have nothing to do with under-declaration. You bought directly from a factory rather than through a trading company. You bought end-of-season or clearance stock. You ordered a large volume. You bought a lower specification that looks similar on paper. The goods are a lesser grade than the comparison the officer is using.

None of that is visible in a database. What makes the difference is whether you can evidence it.

The evidence that actually helps

Assemble this before you need it, not after the query arrives.

A proforma invoice and a final invoice that agree, and a purchase order that matches both
Proof of payment for the full amount, whether a bank transfer record or the letter of credit documents
The supplier's price list or quotation, particularly if it shows the volume discount or the clearance basis
Correspondence showing the negotiation, which is often the clearest evidence that the price was real
The freight and insurance invoices, since these form part of the assessable value and should be documented rather than estimated
Specification documents showing what grade or model you actually bought, where the dispute is really about comparability

Consistency matters as much as content. If your commercial invoice and your packing list describe the goods differently, the paperwork itself invites a closer look. The same applies to classification: an incorrect HS code can put your goods next to a comparison group they do not belong in.

What you are entitled to ask for

Under the valuation framework, doubts about a declared value are meant to be communicated to the importer, with a reasonable opportunity to respond, and the basis on which value was finally determined should be explained in writing on request.

So the useful questions, asked through your C&F agent, are specific ones:

On what basis was the declared value set aside?
Which method was used to arrive at the assessed value?
If identical or similar goods were used, what were they, and how are they comparable to mine?

Requests like these are ordinary procedure rather than a confrontation. They also tend to produce a more considered assessment than a general complaint does.

If you still disagree, there are review and appeal routes, but they take time and the goods are usually sitting at the port accruing charges while you use them. That trade-off is real, and it is worth pricing the demurrage and storage cost of a dispute before deciding to have one.

Under-declaring is not a strategy

It is worth saying plainly, because the practice is common enough that new importers sometimes assume it is normal.

Declaring a value you did not pay is a false declaration. It exposes you to penalties and to seizure of the goods, and the responsibility sits with the importer whose name is on the declaration, not with the agent who typed it.

It also damages you commercially in ways people underestimate. Your insurance claim is limited by the value you declared. Your letter of credit documents have to agree with your invoice. And a low value accepted once becomes the reference point for your next shipment, which means the problem compounds rather than goes away.

If your supplier offers to issue an invoice for less than you are paying, understand what is being proposed. The risk transfers entirely to you at the border.

One thing to check with your agent

Bangladesh replaced the Customs Act 1969 with the Customs Act 2023, which came into effect on 6 June 2024. Much of the published guidance on valuation, including material still carried on official pages, refers to the older Act and its section numbers.

The underlying valuation approach follows the WTO framework and has not changed in structure. But if you are citing a provision in correspondence, or relying on a procedural step you read about, confirm the current reference with your C&F agent rather than quoting an article, including this one.

Valuation outcomes turn on the facts of the individual consignment, and procedures change. For a disputed assessment of any size, take advice from your C&F agent or a customs lawyer rather than relying on a general guide.

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