Harmonized System Code – Important Information

What is Harmonized System Code?

The Harmonized Commodity Description and Coding System normally known as “Harmonized System” or just “HS” is a multi-purpose global product classification created by the World Customs Organization (WCO) and applied all over the world.

In present’s intricate trade environment, product classification stays a major confront for companies as well as regulatory groups. Since companies are regularly developing new products that serve more than one idea as well as use, product classification turns extremely challenging for trade experts and customs officers.

Companies who are looking at choices to decrease costs by applying appropriate releases under definite conditions, benefit themselves of export advantages among others and be obedient with the needs.

On the other hand, the customs agencies are regularly boosting their systems with extra controls in order to stop fraud and save the interested of the country. In any conditions, having a superior product classification method plays a chief role in avoiding disagreements.

Computerization of product classification as well as similar tools to keep trade experts advanced on rigid changes could help in driving fulfillment and cost settlement.

A wrong or confusing product classification calls up huge risk for a company and can considerably wear away its productivity due to enlarged penalties as well as recovery. Take an example, chain and sprockets utilized in motorcycles could any be classified under ITC (HS) Code 73151100 simply as roller chain in the subheading of chain and parts therefore, or under ITC (HS) Code 84839000 in the subtitle of toothed automobiles as well as chain sprockets. The earlier one has a special tax rate of 0% under the Indo-ASEAN FTA and the second hand has a privileged rate of 5%.

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