Brunei Darussalam, a small but wealthy country located on the island of Borneo in Southeast Asia, has a structured customs tariff regime aimed at regulating imports and protecting domestic industries. As a member of the Association of Southeast Asian Nations (ASEAN) and the World Trade Organization (WTO), Brunei adheres to international trade rules, while benefiting from regional trade agreements that lower tariff rates on goods imported from specific countries. Brunei is heavily reliant on imports for a wide variety of goods, given its small population and limited domestic production capabilities. The government applies tariffs selectively to balance the need for affordable goods with the protection of local businesses and industries.
Custom Tariff Rates by Product Category in Brunei
1. Agricultural Products
Agriculture plays a minor role in Brunei’s economy, as the country relies heavily on imports to meet its food and agricultural needs. Tariff rates for agricultural imports are structured to ensure food security while protecting any local agricultural production.
1.1 Basic Agricultural Products
- Cereals and Grains: Brunei imports large quantities of rice, wheat, and other grains to meet its domestic consumption needs. Tariff rates are generally low to ensure affordability.
- Rice: As a staple food, rice imports generally enjoy zero tariffs, though some types may be subject to 5% tariffs depending on origin.
- Wheat and other grains: Typically taxed at 5%, though imports from ASEAN countries may enjoy zero tariffs due to regional trade agreements.
- Fruits and Vegetables: Brunei imports a wide range of fruits and vegetables, particularly from neighboring countries. The tariffs on these products vary depending on seasonality and domestic production.
- Citrus fruits (oranges, lemons): Typically taxed at 5%, but ASEAN-origin products may benefit from zero tariffs.
- Leafy vegetables and potatoes: Tariffs generally range from 5% to 10%, with lower rates applied to essential items.
1.2 Livestock and Dairy Products
- Meat and Poultry: Brunei imports most of its meat and poultry products. The tariff structure is designed to ensure affordability while also supporting local livestock producers.
- Beef and lamb: Imports are generally subject to 5% to 10% tariffs, though halal-certified meat from specific countries may benefit from reduced tariffs.
- Poultry (chicken, turkey): Poultry imports are taxed at 5%, with exemptions or reduced rates for imports from ASEAN countries.
- Dairy Products: The dairy market in Brunei is heavily reliant on imports, particularly from countries such as Australia, New Zealand, and Malaysia.
- Milk powder and liquid milk: Typically subject to 5% tariffs, with lower rates applied to essential products for infant nutrition.
- Cheese and butter: Tariffs range from 5% to 10%, depending on the product.
1.3 Special Import Duties
Brunei benefits from ASEAN free trade agreements (FTAs) that provide for zero tariffs on agricultural products imported from member states. Additionally, under the Generalized System of Preferences (GSP), Brunei imports agricultural products from certain developing countries at reduced or zero tariffs.
2. Industrial Goods
Brunei imports a wide range of industrial goods to support its domestic economy, particularly in sectors such as construction, manufacturing, and oil and gas. The government applies tariffs selectively to support industrial development while keeping essential goods affordable.
2.1 Machinery and Equipment
- Industrial Machinery: Brunei’s industrial machinery imports are critical for the development of its oil and gas industry as well as infrastructure projects. Tariffs on these imports are generally low to promote industrial growth.
- Construction machinery (excavators, bulldozers): Typically taxed at 0% to 5%, depending on the source.
- Oil and gas equipment: Most oil and gas-related machinery and equipment are subject to zero tariffs to support the country’s leading industry.
- Electrical Equipment: Electrical machinery and equipment, such as transformers, generators, and industrial electronics, are essential for Brunei’s energy and construction sectors.
- Electrical machinery: Typically taxed at 0% to 5% to encourage industrial investment.
2.2 Motor Vehicles and Transportation
Brunei imports the majority of its vehicles, both for personal and commercial use. The government imposes tariffs on vehicle imports to regulate the market and promote energy efficiency.
- Passenger Vehicles: Import duties on cars vary based on engine size, vehicle type, and environmental factors.
- Small passenger vehicles (under 1,500cc): Generally taxed at 10%.
- Luxury cars and SUVs: Higher tariffs of up to 20% may apply, with additional duties based on engine capacity.
- Commercial Vehicles: Trucks, buses, and other commercial vehicles are subject to 5% to 15% tariffs, depending on their size and usage.
- Vehicle Parts and Accessories: Spare parts such as tires, engines, and batteries are typically taxed at 5% to 10%, with lower rates for essential parts used in public transport or industrial applications.
2.3 Special Import Duties for Certain Countries
Brunei enjoys zero or reduced tariffs on industrial goods imported from ASEAN member states under the ASEAN Trade in Goods Agreement (ATIGA). Goods imported from countries with which Brunei has bilateral trade agreements, such as China under the ASEAN-China Free Trade Agreement, also benefit from reduced tariffs.
3. Textiles and Apparel
Brunei imports a wide variety of textiles and apparel, primarily from ASEAN countries and China. The tariff structure for textile products is designed to protect local garment manufacturers while ensuring affordable access to clothing for consumers.
3.1 Raw Materials
- Textile Fibers and Yarn: Brunei imports raw materials such as cotton, wool, and synthetic fibers, with low tariffs applied to encourage local garment production.
- Cotton and wool: Typically taxed at 5%.
- Synthetic fibers: Tariffs range from 5% to 10%.
3.2 Finished Clothing and Apparel
- Clothing and Apparel: Imported garments are subject to moderate tariffs, with higher rates applied to luxury items.
- Casual wear and uniforms: Generally taxed at 10%.
- Luxury and branded apparel: Tariffs can reach 15% to 20% for high-end clothing.
- Footwear: Imported footwear is taxed at rates ranging from 5% to 15%, depending on the material and design.
3.3 Special Import Duties
Brunei benefits from zero tariffs on textiles and apparel imported from ASEAN member states under the ASEAN Free Trade Area (AFTA). Additionally, products from countries such as India and China benefit from reduced tariffs under ASEAN’s various free trade agreements.
4. Consumer Goods
Consumer goods such as electronics, home appliances, and furniture form a significant portion of Brunei’s imports. Tariffs on these products are applied to ensure affordability while protecting domestic businesses.
4.1 Electronics and Home Appliances
- Household Appliances: Large household appliances such as refrigerators, washing machines, and air conditioners are subject to moderate tariffs to balance affordability with the protection of local retailers.
- Refrigerators and freezers: Typically taxed at 5% to 10%.
- Washing machines and air conditioners: Subject to tariffs of 10% to 15%, depending on the brand and country of origin.
- Consumer Electronics: Electronics such as televisions, smartphones, and laptops are essential imports, with tariffs applied to regulate the market.
- Televisions: Typically taxed at 5%.
- Smartphones and laptops: Import duties generally range from 0% to 5%.
4.2 Furniture and Furnishings
- Furniture: Imported furniture, including home and office furniture, is subject to tariffs ranging from 5% to 15%, depending on the material and design.
- Wooden furniture: Typically taxed at 10% to 15%.
- Plastic and metal furniture: Subject to 5% to 10% tariffs.
- Home Furnishings: Items such as carpets, curtains, and home décor products are generally taxed at 5% to 10%.
4.3 Special Import Duties
Consumer goods imported from ASEAN member countries benefit from zero tariffs under the ASEAN Free Trade Area (AFTA). Goods imported from non-preferential countries face standard tariffs as outlined by Brunei’s customs tariff schedule.
5. Energy and Petroleum Products
Energy is a key sector in Brunei’s economy, and the country relies on imports to supplement its domestic energy production, particularly for refined petroleum products. The government applies tariffs on energy imports to ensure affordability while encouraging energy efficiency.
5.1 Petroleum Products
- Crude Oil and Gasoline: As a major oil producer, Brunei applies low tariffs on crude oil and gasoline imports to ensure domestic affordability.
- Crude oil: Typically subject to zero tariffs.
- Gasoline and diesel: Tariffs generally range from 0% to 5%, with lower rates for industrial usage.
- Diesel and Other Refined Petroleum Products: Refined products are typically taxed at 5% to 10%, depending on their use and origin.
5.2 Renewable Energy Equipment
- Solar Panels and Wind Turbines: To support the growth of renewable energy, Brunei applies zero tariffs on renewable energy equipment such as solar panels and wind turbines, in line with the country’s commitment to sustainable energy development.
6. Pharmaceuticals and Medical Equipment
Ensuring access to affordable healthcare is a priority for Brunei, and the government applies low or zero tariffs on essential medicines and medical equipment.
6.1 Pharmaceuticals
- Medicines: Essential medicines, including those used for chronic illnesses and life-saving drugs, are generally subject to zero tariffs, ensuring affordability for the population.
6.2 Medical Devices
- Medical Equipment: Medical devices such as diagnostic tools, surgical instruments, and hospital equipment are subject to zero tariffs or low tariffs (5% to 10%), depending on the product’s necessity and origin.
7. Special Import Duties and Exemptions
Brunei’s customs tariff system includes several special import duties and exemptions based on trade agreements and the country of origin of imported goods.
7.1 Special Duties for Non-ASEAN Countries
Imports from non-ASEAN countries, including China, the United States, and Japan, are subject to the standard customs tariffs outlined in Brunei’s tariff schedule. These goods may face higher tariffs compared to imports from ASEAN member states.
7.2 Bilateral and Multilateral Agreements
- ASEAN Free Trade Area (AFTA): Brunei benefits from zero tariffs on goods traded within ASEAN, promoting regional economic integration.
- ASEAN-China Free Trade Agreement (ACFTA): Brunei enjoys reduced tariffs on goods imported from China under this agreement.
- World Trade Organization (WTO): As a member of the WTO, Brunei adheres to international trade rules, benefiting from most-favored-nation (MFN) tariffs on imports from WTO member countries.
Country Facts
- Official Name: Nation of Brunei, Abode of Peace (Negara Brunei Darussalam)
- Capital City: Bandar Seri Begawan
- Largest Cities:
- Bandar Seri Begawan (Capital and largest city)
- Kuala Belait
- Seria
- Per Capita Income: Approx. $28,000 USD (2023 estimate)
- Population: Approx. 460,000 (2023 estimate)
- Official Language: Malay
- Currency: Brunei Dollar (BND)
- Location: Brunei is located on the northern coast of the island of Borneo, in Southeast Asia, bordered by Malaysia and the South China Sea.
Geography of Brunei
Brunei spans an area of 5,765 square kilometers and is divided into two separate parts by the Malaysian state of Sarawak. The country has a tropical rainforest climate, with high temperatures and humidity throughout the year.
- Climate: Brunei has a tropical climate with year-round rainfall and high humidity. The monsoon season occurs between November and March.
- Rivers: Major rivers include the Brunei River and Belait River, which are important for transport and water resources.
- Forests: Brunei is heavily forested, with tropical rainforests covering much of its land area. The country has made efforts to conserve its forests through strict environmental regulations.
Economy of Brunei
Brunei’s economy is dominated by the oil and gas sector, which accounts for the majority of government revenue and export earnings. The country has one of the highest standards of living in Asia, driven by its natural resource wealth and prudent economic policies.
1. Oil and Gas
The oil and gas sector is the backbone of Brunei’s economy, contributing over 90% of export revenue. The country is a major exporter of crude oil and liquefied natural gas (LNG), primarily to Japan and South Korea.
2. Agriculture and Fisheries
While agriculture plays a relatively minor role in Brunei’s economy, the government has been investing in initiatives to boost self-sufficiency in food production. The fisheries sector is also important, contributing to domestic food supply and exports.
3. Finance and Services
Brunei has a growing financial services sector, with a focus on Islamic banking and wealth management. The country’s strategic location and political stability make it an attractive destination for foreign investment.
4. Tourism and Culture
Brunei is promoting eco-tourism and cultural tourism, capitalizing on its rich heritage and pristine rainforests. The country is known for its Islamic architecture, including the Omar Ali Saifuddien Mosque and the Istana Nurul Iman, the Sultan’s official residence.
