Harmonized System Code and its benefits

Harmonized System Code:- HS or Harmonized System code is also referred as HTS or Harmonized Tariff Schedule Code. This coding system and its description is created by the World Custom Organization (WCO) to categorized the goods in approximately 5,000 commodity groups which is accepted and implemented in more than 200 countries across the world. The HS code has been used by 98% of Import Export trade throughout the world. The Harmonized System was introduced in 1988 and has been adopted by most of the countries worldwide. It has undergone several changes in the classification of products called as revisions. These revisions happened in the years 1996, 2002 and 2007.

Harmonized System Code and its benefits

How the HS Code is defined:-

World Customs Organization (WCO) has been administering 6 digits HS codes schedule. First two digits are called ‘Chapters’, first four digits is called 'heading' and six digits 'sub heading'. However each country can modify by adding two digits or four digits as per their requirements without changing first six digits. Or we can say that first six digits of HS code remain the same in all the countries. The countries can add the additional digits to categorize and define their commodities but cannot change the first six digits. At the international level, the Harmonized System (HS) for classifying goods is a six-digit code system.

Benefits of HS Code

·         It helps in enabling the amount of custom duties payable to be calculated more accurately.
·         It helps in reducing the disputes with customs
·         It simplifies the trade transactions
·         It helps in shortening the customs clearance time and processing costs
·         It facilitates the trade negotiations
·         Increases the trade supply chain security

No comments:

Post a Comment