Includes information on average tariff rates and types that U.S. firms should be aware of when exporting to the market.
Honduras is a member of the Central American Economic Integration System (SIECA) comprised of Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, and Panama. Honduras’ tariffs on most goods from outside SIECA are currently within the zero to 15 percent range. Nearly all textile and apparel goods that meet the agreement’s rules of origin receive duty-free and quota-free treatment, providing opportunities for U.S. and regional fiber, yarn, fabric, and apparel manufacturing.
The Harmonized System (HS) classification number determines if a specific product can enter the CAFTA-DR region duty-free. This number is used to check the country and product-specific tariff elimination schedule. Honduran customs are very strict when evaluating certificates of origins. Even minor errors can result in fines and non-CAFTA import duties. Please contact the U.S. Embassy in Tegucigalpa if you feel the rules are being implemented unjustly.
For more information on the practical aspects of exporting under CAFTA-DR please consult the links below:
Under CAFTA-DR, Honduras will eliminate tariffs on yellow corn and pork by 2020. Import tariffs for rice and chicken leg quarters will also be eliminated in 2023, and for dairy products in 2025. Accordingly, CAFTA-DR should lead to the elimination of market access barriers, over time, for all agricultural products other than white corn.
There are restrictions on imports of white corn in order to protect local production. A price band mechanism is applied for white corn imports out of CAFTA-DR. Corn producers and meal industries that use this grain for human consumption sign a grain agreement annually. The agreement indicates that for each 100 pounds of white corn purchased from national production, industry could import 100 pounds. The agreement is endorsed by the Secretariat of Agriculture and the Secretariat of Economic Development. Importers who want to import white corn from the United States, and who are not part of the agreement pay 45 percent duty.
Rice producers and millers have an agreement that establishes that an internal regulation will be applied every year. It is signed between millers, rice producers, the Secretariat of Agriculture and Secretariat of Economic Development. The agreement states the conditions that the rice will be paid by the millers such as quality, humidity, payment requirements, and sale price. The regulation also includes the no-supply quota which will bring the tariff to zero to cover the demand of rice if needed. For imports of rough rice inside the CAFTA-DR quota, the duty is currently at 22.6 percent. The CAFTA quota for importers in 2021 will be calculated according to the amount of the domestic rice they purchase.
A general 15 percent Value Added Tax (VAT) is applied to most products. Goods exempted from this tax include staple foods, fuels, medicines, agro-chemicals, books, magazines and educational materials, agricultural machinery and tools, handicrafts, and capital goods such as trucks, tractors, cranes, and computers, among others. Goods and services imported by the maquiladora industry and other firms protected under Special Export Development Regimes are also exempted from the tax. A separate 18 percent sales tax is applied to beer, brandy, compound liquors, and other alcoholic beverages, as well as tobacco products. This tax is levied on the distributor sale price, minus the amount of the production and consumption tax on both imports and national products. This calculation procedure is also applied to the 15 percent tax on carbonated beverages. A 15 percent selective consumption tax is also applied to some products considered non-essential.
Additional information on import tax legislation, customs regulations, and general administrative procedures is available at the official Single Window for Importers and Exporters and at the Customs Directorate: www.dara.gob.hn.