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Iraq Import Tariff

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Iraq import tariff system is undergoing significant reform as of 2026, marked by a shift toward digital enforcement and uniform application across all border crossings. The framework is based on the Customs Tariff Law No. 22 of 2010, with rates now ranging from 0.5% to 30% across approximately 16,400 tariff lines classified under the Harmonized System (HS).

Key Reform: Cabinet Decision No. 957

In late 2025, the Iraqi Cabinet approved Decision No. 957, which took effect January 1, 2026. This decision activated the revised customs tariff schedule nationwide, including the Kurdistan Region, and replaced the previous system of fixed fees per container with duties calculated based on the type and actual value of goods inside each container.

The reform is coupled with the rollout of the ASYCUDA electronic customs system, which requires traders to submit declarations digitally and pay duties through the banking system. The goal is to reduce manual processes and discretionary practices at borders.

Tariff Rates by Category

The tariff structure applies different rates depending on the classification of goods:

Essential Goods and FoodstuffsBasic food items, medicines, and medical supplies remain subject to reduced rates, generally between 0.5% and 5% to protect consumer prices. The government has explicitly stated that essential goods affecting citizens’ daily lives are not subject to the recent increases.

Industrial InputsRaw materials used in domestic production face low duties, typically 0.5% to 2%, to support local manufacturing.

Consumer Goods and ElectronicsElectrical appliances and household goods generally fall within the 10% to 15% range. A specific rate of 30% per unit has been cited for certain electrical appliances.

Luxury and Non-Essential ItemsLuxury goods, gold, and certain consumer items face higher duties of 20% to 30%. Gold is subject to a 5% duty based on value, while hybrid vehicles have had their previous exemption removed and now face a 15% customs duty.

VehiclesImported vehicles are taxed at 15% or higher, determined by engine size, year of manufacture, and environmental compliance. The tariff applies uniformly to conventional, hybrid, and electric vehicles.

Tobacco and AlcoholThese products are subject to significantly higher duties, often exceeding 60%, as part of health and revenue policy.

Additional Protective Duties

Beyond the standard tariff schedule, Iraq has imposed additional duties on specific products to protect domestic industries:

  • Intravenous solutions: 50% customs duty, effective for four years
  • Transparent containers and single-use plastic cups: 60% additional duty
  • Reinforcement steel bars (10-32 mm): 10% additional duty
  • Medical and industrial oxygen (gas and liquid): 40% duty
  • Nitrogen: 40% duty

Pre-Declaration Requirement

Since January 1, 2026, all goods and commodities are subject to a pre-clearance declaration system. Traders or importers must declare goods through the pre-declaration system before completing fund transfers. Upon arrival at the border, customs authorities review and compare the pre-declaration information. This measure aims to reduce irregularities in customs operations and increase tax revenue.

Market Impact and Controversy

The tariff enforcement has generated significant market disruption. In February 2026, wholesale traders in Baghdad staged strikes to protest the new tariffs, warning of sharp consumer price increases. Merchants reported that clearing a shipping container that previously cost 3,000,000 IQD now requires 37,000,000 IQD in duties, making imports financially unviable for many. The government has defended the measures as necessary to reduce public debt, combat tax evasion, and strengthen non-oil revenues.

Compliance Considerations for Importers

For businesses trading with Iraq, the key implications are:

  1. HS Classification: Ensure accurate classification under the Harmonized System, as the applicable rate depends on the correct tariff line.
  2. Pre-Declaration: Complete the electronic pre-declaration before initiating fund transfers.
  3. Valuation: Duties are now calculated on the actual value of goods, not container size, so accurate invoicing is essential.
  4. Digital Payment: Duties are automatically deducted through the ASYCUDA system upon arrival at customs centers.

The tariff environment remains subject to legal and political debate, with critics arguing that administrative decisions cannot effectively impose new taxes without parliamentary approval. Importers should monitor ongoing developments, as the system continues to evolve.