It is important to have the Correct Tariff Classification on goods.
All goods imported into the USA are subject to duties. All import items are required to be classified in accordance with the harmonized schedule of the United States, and each tariff number has a corresponding rate of duty. Rates of duty for imported merchandise may also vary depending of the country of origin.
The actual duty rates of the items you import may be different from your expectations – this is why the correct classification is important.
Based on classification of the goods you are importing, US customs determines which harmonized Tariff Schedule (HTS) will apply to your goods and the HTS number determines the applicable duty rate.
The Tariff Database is an interactive data base that will enable you to get an approximate idea of the duty rate for the product. Before you import, find out the correct HTS number for the product. It is important to know the HTS number to calculate the correct duty and advise your seller how to describe the product. You can find the correct HTS code for your shipment by logging on to: https://www.usitc.gov/tata/hts/bychapter/index.htm.
Are you having difficulty deciding how to classify your items or merchandise?
Having the correct classification is a legal responsibility. Non-compliance can mean shipment delays, increased inspections, fines, and other administrative penalties.
Classification depends on various factors – full and complete description of the goods, the component materials, and the goods’ principal use in the United States. These are basic important factors that determine the correct HTS number for your product.
Sometimes it may be difficult to decide how to classify your merchandise. Some suggested ways to determine the correct classification are:
- Use the CROSS database.
You can research the results of previous ruling requests by using the Customs Rulings Online Search System at http://rulings.cbp.gov/index.asp to see if U.S. Customs have already issued rulings on products like yours. CROSS also addresses other issues such as value, country of origin marking, etc. The CROSS database is searchable by key word.
- Binding Ruling
If you are having difficulty classifying your product you can ask for verbal advice from a commodity specialist or request a legal binding ruling. You can request a binding ruling to CBP before importing. U.S. Customs and Border Protection (CBP) issues binding advance rulings and other legal decisions about the importation of merchandise into the United States.
Importers can request a written ruling from CBP for the proper HTSUS classification and rate of duty for their merchandise.
Below are some of our suggestions for importers:
- Always advise the shipper on how to describe the product on the invoice.
- A minor error in wording or an incomplete description can lead to the wrong classification of the merchandise which may cause the importer to pay the wrong duty amount, or prolong US customs inspections.
- It is always a good idea to put the HTS number on the commercial invoice, too.