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An Overview of HTS Codes

HTS codes are a tool used globally. The World Customs Organization (WCO) preserves the Harmonized Tariff Description and Coding system (HTS). Over 170 countries take part in the WCO’s HTS system. The initial six digits of the HTS code identifies all the items in international trade and they are similar for every country that uses the HTS. The last two or four digits give the duty rate and balance of trade statistical reporting suffix for the imported merchandise. If you are an importer, you are in charge of establishing the right HTS classification to be used on your import entries and ISF security filings. This supports why it is mandatory to establish that correct details about your goods is reported to CBP. Additionally, you shouldn’t rely on third parties to guess about your goods and provide HTS classifications on your behalf. It is your responsibility as the importer to provide sufficient detailed information of the imported goods so that the customs professional can know the right classifications for those items.

You may have paid more by using an incorrect HTS code. The HTS is primarily a classification tool to uniformly identify products and the other secondary function is that it is a tariff system on imported goods. If you use an inappropriate HTS, it causes a wrong payment of duties which can be high or low. The effect of this is seen in the CBP during revenue collection, and it may lead to them to giving fines for lack of giving the recommended and right information to CBP. It could be that you have been using wrong HTS codes, it’s never late to rectify this so that you avoid costly fines. When you realize that you have been using incorrect HTS codes and been paying more or less, you have two choices for correcting this matter. You can file for a Post-Entry Amendment (PEA) to pay any extra owed duties or to request a refund for overpayments. If the entry has been liquidated which usually happens 315 day after entry, you can file an administrative protest up to 180 days after liquidation of the entry.

HTS codes keep changing. Universally, the HTS is always updated and changed to allow for innovation and technology. Additionally, states are evaluating new revenue avenues and looking into balancing their trade with other countries. In the U.S when an HTS code is created, it has a date when it will expire to enable any updates to be implemented. Accordingly, constantly ensure that the codes you are using are still valid and correct. Categorization of imported products is a never-ending task.

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