Save tax on imported vehicles

U.S. personnel stationed in Europe may ship vehicles to the states duty-free. But this customs exemption can mean big savings only if servicemembers meet three conditions.

Members must take physical possession of the vehicle before leaving Europe, have valid movement orders and import it for personal use.

“Most people who encounter problems fail to take physical possession of a vehicle before shipment,” said Michael L. Burkert, director of the U.S. European Command’s Customs and Border Clearance Agency.

Members run the risk of having to pay the 2.5 percent import duty if someone with a power of attorney ships the car after the member leaves Europe, he said. Having a car shipped to the states from the factory can also be costly because the owner never physically took possession of the vehicle, he said.

Registering a vehicle is the most common way of proving possession. But customs officials will cross-check the dates on movement orders with the registration to ensure the vehicle was shipped before leaving Europe.
When registration is not feasible, members can also prove possession by personally putting a copy of their movement orders in the glove compartment.

Second, the member must have a set of change-of-station orders in hand before shipping a vehicle. People on extended leave or temporary duty are not entitled to the exemption.

Third, the vehicle must be for personal or immediate family members’ use.
“If you had six dependents of driving age, you could justify importing seven vehicles duty-free; one for each of them and one for yourself,” said Mr. Burkert.

However, it is illegal to use the exemption to import vehicles for third parties or in order to sell them.

When shipping vehicles stateside as part of a PCS move, servicemembers can avoid federal duties and taxes, but usually not the state taxes, which can be high.

Call a military customs office to learn more about federal duty exemptions. Call Ramstein’s Transportation Management Office at 480-5538 for details on the haulage rules.
(Courtesy of EUCOM Customs)