Tariff codes 101
Classifying imported and exported goods is a crucial aspect of global trade. The system used for this purpose is known as the tariff code, which is similar to the Dewey Decimal system used in libraries to categorize books. Each product involved in international trade is assigned a unique tariff code, also referred to as a harmonized system (HS) number.
A complete tariff code contains a minimum of six digits, but it can have a maximum of ten. Codes with less than six digits represent broader product categories, while those with more digits offer more specificity in identifying the product. By referring to the customs tariff book, you can observe how the digits increase as the product’s definition becomes more precise.
Determining the correct code is important, as it directly impacts the import duty tax applicable to the product. To ensure accuracy, it is highly recommended to use the correct tariff code. This not only affects the final cost of the goods but also helps avoid clearance delays at customs and potential penalties.
If you are an importer, the easiest way to obtain the correct code is to ask your supplier. They are obligated to provide the accurate tariff or HS code on all export documents, having taken the effort to establish the correct classification.
For first-time exporters or those seeking reassurance, professional tariff classification service can be arranged. Alternatively, you can utilize the Tariff Code directory, which offers a comprehensive list of codes along with corresponding product descriptions.
However, assigning the code yourself can be complex, and mistakes may lead to fines and additional duty taxes. It is thus advisable to have your tariff or HS code validated by a professional who can defend their determination based on the tariff rules when dealing with customs.