What are Harmonized System (HS) codes? Simply put, it's a unique series of numbers assigned to products for international trade. These codes allow customs agencies to identify products regardless of linguistic barriers. However, pinpointing the right HS code for a specific commodity isn't always easy. With thousands of codes out there, it can be difficult to find out how to identify HS codes for your imported goods.
According to the U.S. Customs and Border Protection, an HS code is a universal system used by the majority of countries for classifying traded products. It simplifies customs processes, helping to identify products and determine tariffs.
Looking for more information about Harmonized System codes and HS code meanings? We’re here to help. Read on to learn more about these codes, including their use in international trade and how to find the right one for your imported goods.
An HS code is a number assigned to commodities for the purpose of simplifying international trade. Created by the World Customs Organization (WCO), HS codes serve as a standardized numerical method for classifying products. This code, along with the country of import and other information, is used on importer shipping documents and commercial invoices.
Harmonized Systems codes are a key element of importing and international shipping. Two notable reasons for this are:
There are well over 5,000 groups of commodities by the WCO. This allows for a great deal of detail in describing items traded from one country to another.
It’s worth noting that new importers often confuse HS codes with Harmonized Tariff Schedule codes. We’ll compare the two later in the article, but keep in mind that they are two different codes with similar (but not identical) purposes.
HS codes are always six digits long. Anything longer than six digits is a different code, such as an HTS code or schedule B number. Remember, the HS number of a product will never exceed six digits in length.
All products in international trade have an HS code. If you’re importing a product into the U.S., it will require an HS code.
Customs and Border Protection (CBP) uses this code to identify cargo that enters the country. Shipments with incorrect, incomplete, or missing codes won’t pass customs and may result in fines for the importer.
You might wonder what the digits of the HS code mean. In structure, an HS code consists of three sets of two digits. The WCO defines these sets as:
Each two-digit code represents an increasing level of specificity in relation to the product it describes. As an example, let’s break down the HS code for a flat screen computer monitor, which is 8528.59.
As you can see, the description starts out very generalized and narrows in focus with each succeeding two-digit set. This simplifies the process of identifying imports for customs agencies around the world.
For all practical purposes, HS codes are universal for U.S. importers. Over 200 countries have agreed to the HS standards set by the WCO, and those who haven’t tend to have strained trade relations with the United States. Therefore, unless you were hoping to import something from Pyongyang, HS codes are effectively universal.
HS codes do not vary from country to country within the sphere of WCO members. Nearly every country on Earth claims membership in the organization, so HS code variances only occur in outliers, such as:
While HS codes are consistent from one WCO member to another, there is a similar code which does vary by country. The United States CBP calls this an HTS code.
HS codes and HTS codes are not the same thing. This is one of the most confusing topics for new importers, so we’ll lay out the differences as simply as possible.
One of the reasons this distinction isn’t always clear is that the first six digits of an HTS code are, in fact, the HS code of the commodity in question. To provide some clarity, let’s refer back to our computer monitor example.
The HS code for our monitor is 8528.59. It has a screen with a diagonal measurement exceeding 13.5 inches. This results in an HTS code of 8528.59.50.
Since we don’t have a free trade agreement in place with the exporting country, the monitors are subject to a flat five percent duty once they reach the U.S. In the following table, you’ll see how that fee plays out in a bulk order intended for resale stateside.
|Quantity Ordered||Price in USD||Tariffs Collected in USD|
|1,000 units||$75.00 per unit||$3,750|
To summarize, HS codes identify a commodity for the purposes of international trade. HTS codes indicate any taxes, tariffs, and duties on that commodity when it is imported to the United States.
Not sure which HS or HTS code to use? Leave it to the professionals.
Book a consulting session with a customs expert.
An HS code may be part of a tariff code, but tariff information is not indicated by the HS code alone. In the United States, the previously mentioned HTS code is what some people would call a tariff code. It contains additional digits (up to a total of 10), which are used to denote tariff charges.
Strictly speaking, HS codes and commodity codes aren’t the exact same thing. However, it isn’t always as simple as that in practice.
The term ‘HS code’ has a very specific definition: a six-digit product identification code used to simplify international trade. The definition of commodity code or HS commodity codes is a little more vague.
For example, the UK uses commodity code as their equivalent to U.S. HTS codes. However, it’s also common for the term to be used as a sort of catch-all for the various codes related to importing and exporting. This can include Schedule B codes and, yes, even HS codes.
As an importer located in the United States, the best way to avoid confusion here is to stick with using clear, well-defined terms such as HS and HTS codes. This will spare you additional confusion in what is already a somewhat confusing process.
Yes, HS codes and HSN codes are the same thing. The full name of the method developed by WCO is Harmonized System of Nomenclature, or HSN. While most countries refer to the codes with the acronym HS, India favors the full acronym of HSN.
If you want to know how to find the HS code of a product, the best way is to consult with a customs broker. These professionals are experienced with the intricate nuances of commodity classifications.
Brokers know how to get the HS code that best describes your imported goods. Working with a broker can prevent clearance delays and help you avoid potential fines for incorrect HS codes.
If you want to attempt to search a customs HS code list on your own, there are options available. One of them is our own HTS lookup tool, which pulls double duty as an HS code lookup tool. Remember: the first six digits of this code consist of your product’s HS code. Everything after those six digits has more to do with taxes than product identification.
The WCO also has its own HS code search tool, which is available for importers within member countries.
HS codes play an important part in the import process, and finding the correct one isn’t always as easy as it seems. If you need help finding the right HS code, HTS code, or assistance with any aspect of importing, we have the knowledge and know-how you’re looking for.
USA Customs Clearance brokers have over 100 years of combined experience in the complex world of U.S. customs. Our services can save you time, money, and headaches during the import process.
Partner with us for:
Call our team of import professionals at (855) 912-0406 or contact us online. We’re here to help you take the guesswork out of U.S. customs clearance.