The Harmonized system (HS) classification is a six-digit code for classifying internationally traded goods. These codes are used by customs authorities across the world to identify tax and duty rates for different products.
HS codes are administered by the World Customs Organization and are recognized in over 98 percent of the global trade. This code is a universal classification tool. Many countries add additional digits to this code to further classify the products in specific categories. These digits differ across countries.
These codes are required for international export documentation and all commercial invoices. In fact, any documents that are used internationally should display the HS code.
The Harmonized Tariff Schedule (HTS) code is a 10 digit classification system specific to the United States. The first six digits are the HS code, and the States next four numbers are unique. All U.S importers must know and use the correct codes because commodity duties are based on HTS classification.
With correct HS/HTS codes, you can be sure that you are not losing out on preferential tariff rates under free trade agreement (FTA). HS/HTS codes are also needed to ensure that your business is in complete compliance with all international trade regulations.