Smooth Customs Clearance of Chongqing’s First “Tariff Guarantee Insurance” (TGI)

The Tariff Guarantee Insurance is widespread in Chongqing, and officially implemented nationwide

By Xinyi Li, EDITOR

On November 1, staffs from Chongqing Reston Imp Exp Co., Ltd. dealt with customs clearance for imported automobiles at Chongqing Customs District P. R. China. The batch of imported automobiles is worth RMB 410,000 (USD 59,198). They held the first “Tariff Guarantee Insurance” (TGI) in Chongqing. It is issued by the Chongqing Branch ofPeople’s Insurance Company (Group) of China. It indicates the TGI has been comprehensively widespread in Chongqing eventually. The General Administration of Customs of the People’s Republic of China (GACC) was sparing no effort to launch TGI before then. Furthermore, the “Tariff Guarantee Insurance” was officially diffuse nationwide from that day.

What is Tariff Guarantee Insurance?

“Tariff Guarantee Insurance” (TGI) is a model to realize the “release before duty payment”. It regards consignees or consigners of import or export cargo as the insurance applicants. The Customs acts as the insured at the same time. Enterprises buy the TGI from the pilot insurance company. After that, they can deal with the tax-type guarantee procedures in the Customs via the TGI Policy issued by the insurance company.

Deng Jikuan, indicates that the TGI is a key way for the Customs to shorten the clearance time and reduce enterprises’ cost. He is the head of Chongqing Customs District P. R. China, which is a connection between Customs and enterprises. Popularizing insurance will effectively reduce the cost and lower the threshold of enterprise financing. 

It provides new approaches for import and export enterprises to solve the problems of “difficult and expensive financing”. Those enterprises are usually micro, small and medium-sized enterprises. In addition, enterprises’ “burden alleviation”, “acceleration”, and “efficiency increase” are important. Meanwhile, it has also further improved the convenience in customs clearance and optimized the business environment.

Advantages of Tariff Guarantee Insurance

Ms. Zhang from Chongqing Reston Imp Exp Co., Ltd. indicates that the TGI changes the model of import and export trade. Previously, the enterprise has to process tariff guarantee through the cash deposit, bank guarantee, or professional guarantee agencies. But now, business capital and credit line will no longer be occupied. With the high efficiency, the processing of an insurance policy of RMB 230,000 (USD 33,208.68) only needs one day. Therefore, the TGI offers double assurance for the efficiency of customs clearance of imported goods as well as the turnover rate of capital utilization. After calculation, this model can reduce about 98% of the capital actual cost, and improve 33% of the turnover rate.

Otherwise, in light of the regulation on the insurance applicant who is a consignor or consignee with general credit and above of imported or exported goods, 11,835 enterprises with general credit and above in Chongqing Customs District can make independent choices based on their demands to sign the Tariff Guarantee Insurance Policy with the pilot insurance companies.

Source: CQNEWS