HTS codes are global tools maintained and harmonized by the World Customs Organization (WCO). There are more than 170 countries that take part in the HTS systems of the WCO.
The harmonized tariff code has digits, each playing a role. The first six digits of the code are identifiers of all the items in international trade. These are common to all countries using the HTS systems. The last four or two digits of the code specify a country. The last 4 codes are mostly used as specifications of duty rate as well as the balance of trade. These are statistical reporting’s suffixes on imported goods.
An importer plays the role of identifying the right HTS classifications that are used in their import entries, as well as register its security filings like the schedule b number. With this, it is imperative to have an accurate product information. Relying on third parties to guess about your products and then classify their HTS on your behalf is not right. An importer is are responsible for supplying enough information about the commodities being imported. This helps the customs expert to identify the right classifications of such goods.
You could be a victim of paying more than you should if you are using the wrong HTS code. First, the HTS is meant to identify products uniformly. Secondly, it is used in the tariffs of imported goods. If you use the wrong HTS, you will end up paying incorrect duties. This could either be too much, or too little. This will raise an issue for CBP when collecting revenue, and might even lead to fines or penalties if you do not provide the accurate and correct details to CBP.
In case you have been using the incorrect HTS codes, you still can fix your mistake to get rid of fines and penalties. In case you have been paying too little or too much as a result of the wrong codes, all you need to do is file a Post-Entry-Amendment (PEA). With this, you will pay all extra duties owed. You can also request refunds on any overpayments you might have.
HTS codes keep on being changed all over the world in a bid to accommodate new product innovations as well as technology. Therefore, HTS codes have expiration dates so that they can accommodate updates. With this, you should be constantly checking your codes to ensure that they are still valid. At least review your HTS codes on an annual basis. Check this video about tariff code: https://www.youtube.com/watch?v=2hGUx5bfFPw.