HS Codes (Harmonized commodity Description and Coding System) are numerical codes that describe the product that companies ship around the world. When importing products into a country you are usually required to make a legal declaration of the products to Custom Clearance.
HS codes help the customs agents of the importing country to determine the amount of duties that have to be paid along with VAT (Value Added Tax) for this particular product. Declaring the wrong HS code could lead to an inaccurate tax declaration and identifying the right category can be a matter of debate..
These codes are also used to assess if there are other controls on the import of products, whether they need special examination and other requirements. For example when ODM export wooden products to Australia they are subject to fumigation or other controls and the HS code can flag this to customs.
A HS code consists of a minimum of 4-6 digits. The code starts with the Chapter, followed by the heading and then lastly the subheading of which the item is categorized. Further subdivisions are made in individual countries and trading blocks according to their standards.
This tool on the DHL website is quite useful for checking the HS codes of a product. Be careful when assigning codes to product as these can get quite complex.
Below is an example of how we can classify a “knife” – first number being the 4 digit HS code.
- 8465: Machine tools (including machines for nailing, stapling, gluing or otherwise assembling) for working wood, cork, bone, hard rubber, hard plastics or similar hard materials
- 8441: Other machinery for making up paper pulp, paper or paperboard, including cutting machines of all kinds, and parts thereof
- 8536: Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, relays, fuses, surge suppressors, plugs, sockets, lamp- holders and other connectors, junction boxes), for a voltage not exceeding 1,000 V; connectors for optical fibers, optical fiber bundles or cables
- 8535: Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, fuses, lightning arresters, voltage limiters, surge sup-pressors, plugs and other connectors, junction boxes), for a voltage exceeding 1,000 V
- 8215: Spoons, forks, ladles, skimmers, cake-servers, fish-knives, butter-knives, sugar tongs and similar kitchen or tableware; and base metal parts thereof
- 8211: Knives with cutting blades, serrated or not (including pruning knives), other than knives of heading 8208, and blades and base metal parts thereof
- 7228: Other bars and rods of other alloy steel; angles, shapes and sections, of other alloy steel; hollow drill bars and rods, of alloy or nonalloy steel
- 7226: Flat-rolled products of other alloy steel, of a width of less than 600 mm (23.6 inches)