An Overview of HTS Codes
HTS codes are a tool used globally. The World Customs Organization (WCO) manages and maintains the Harmonized Tariff Description and Coding system (HTS). More than 170 countries participate in the WCO’s HTS system. The first six digits of the HTS code refer to the goods in international trade, and they are the same for all countries that use 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 supposed to determine the appropriate 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. Moreover, do not leave it up to third parties to guess about your products and give HTS classifications for you. It is your duty as the importer to give sufficient details of the imported goods so that the customs expert can establish the suitable classifications for those goods.
You may be overpaying by using an incorrect HTS code and that is why a lot of attention is needed. The HTS is a classification system to uniformly recognize goods and secondarily a tariff system on imported items. 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. The HTS codes you were utilizing might not be the right ones, you still have time to amend this so that you eliminate extravagant penalties. 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. When the entry is already liquidated which tends to happens 315 day after entry, you can seek for an administrative protest up to 180 days after liquidation of the entry.
HTS codes are not static. Universally, the HTS is always updated and changed to allow for innovation and technology. Also, states are reviewing new income avenues and they desire to balance their trade with other countries. In the U.S when an HTS code is developed, it is designed with an expiration day to allow any updates to be implemented. As per this, always confirm that the codes you use are the right ones. Classification of imported items is an ongoing project.