HS stands for the Harmonized System, which was developed by WCO (World Customs Organization). Nowadays, customs officials must use the HS code to clear every item entering or crossing international borders.
How will you determine the HS codes?
Although the HS code improves the classification of internationally traded products, the process of consideration can be confusing and complicated. Still, at the same time, it is essential to correctly classify products according to the correct HS code to avoid the goods being detained at customs or to prevent penalties due to incorrect classification.
The HS is logically designed by economic activity or its constituent material. It is divided into 21 sections and sub-divided into 99 chapters. The HS Code has six digits.
What is the importance of HS codes in global trade?
Proper taxation by governments/customs — As there is an identification system for all globally traded goods. It is easier for customs to allocate the correct amount of taxes and duties to importers and exporters according to the HS code.
Shipping is faster with the right HS Codes — It is used to make sure you categorize your products in the right HS Codes, which may add more time to international shipping. But it will save you from many other troubles if customs are unable to correctly identify a product because it is marked with an invalid HS code. This can cause delays, storage costs, and even penalties.
Legal Responsibility — This is part of the legal responsibility of both the importer and exporter to identify and document the correct HS code on the invoice.
Trade Statistics — Government agencies can create and study trade statistics and trends with the help of HS codes.
What is the classification of the HS codes?
The classification of the HS codes are given by,
Therefore, the HS code is the standard method of classifying products transported worldwide. If you are an importer or exporter, you must be familiar with the HS and HTS codes as they are commercial languages ??of the world. However, the task of finding the correct HS Code for your product may seem too difficult at first. You should have an understanding of these Codes as they are your legal responsibility.
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