As in any other country, customs activities began at the same time as the development of trade. In the territory of Mongolia, first traces of government and trade with neighboring countries date all the way back to the 3rd century B.C.
History states that Customs relations began in the 4th century B.C. in Mongolia. Khun state was empowered and was collecting taxes from its own people as well as its neighboring countries. Furthermore, the Silk Road was under Mongolian control and traders using the road were subject to tax. The first Customs duty was collected under the name “Seal Duty” with the order of king Ogodei.
In the thirteenth century, when the United Mongolian Kingdom was declared, the internal affairs of Mongolia along with thoroughly organized tax systems were established. Since then, trade and customs were developing rapidly. There were markets selling goods and more than twenty different trading countries. In 1206, Ikh Huraldai declared a national constitution which is known as Ikh Zasag. Amendments made to Ikh Zasag in 1210 and 1218 to include propriety ownership, tax payment, trade, and religious people to be released from duty out of respect.
During 12-14th century trade was undertaken in order to increase the king’s monetary fund. In 1236, taxation on filaments entered force. Mongolian great kings Chinggis, Ogodei promoted international trade, attracting traders through duty exemption and relief and ensuring secure trade, while controlling the dishonest behavior, corruption and bribery carefully. In the era of Khubilai king, the customs duties were paid by bank notes. In 1689 Mongolia made the first trade agreement with Russia and China. Since the 14th century United Mongolia was no more and the government customs tax policy also disappeared.
Seventeenth century marks a dark period in Mongolian history and in the history of Mongolian customs and trade. For more than 200 years, Manchuria ruled Mongolia and limited Mongolian trade to only China and collected customs duties from Mongolians. Manchurian government created legislations to tax the Chinese traders in 1720 and all the duties collected from those Chinese traders went to the Manchurian authorities. Mongolia fought the oppression of Manchuria and was freed in 1911.
After the national revolution, the customs affairs continually improved. The first customs legislation entered force in 1912 with 4 chapters 16 articles. In October 1921, a Rule on "Imposition of Customs duties and charges on external and internal trade" was adopted to become effective from October 20 in Niislel Khuree, the capital city of Mongolia and for other places to be effective from the date when reached by. Thus the Mongolian Customs under its own People's Power started to operate. Thereafter the date, i.e., 20 October 1921, becomes the Mongolian Customs Day.
Historical chronicles of Customs body arc as follows:
1921-1930 Customs department of Ministry of Finance
1930-1932 Customs department of Ministry of Trade and Industry
1932-1954 Customs department of Ministry of Finance
1954-1956 Customs department of Ministry of Defence and Social Security
1956-1991 Customs department of Ministry of Foreign Trade and Customs General Committee and Customs Administration
1992 State Customs Administration under the Cabinet
Since 1996 Customs General Administration- a Government Coordinating agency.