How to Find the HS Code Duty Rate for Your Products

If you are importing or exporting products, you need to know the HS code duty rate for your products. The HS code, or Harmonized System code, is a standardized classification system that assigns a six-digit number to every product that is traded internationally. The HS code duty rate is the amount of customs duty that you have to pay when you import or export a product.

The HS code duty rate depends on the product category, the country of origin, and the destination country. To find the HS code duty rate for your products, you can follow these steps:

1. Identify the HS code for your product

You can use online tools such as the World Customs Organization’s Harmonized System Database (https://www.wcoomd.org/en/topics/nomenclature/instrument-and-tools/hs-nomenclature-2023-edition/hs-nomenclature-2023-edition.aspx) or the U.S. International Trade Commission’s HTS Search (https://hts.usitc.gov/) to search for your product by name, description, or keyword. You can also consult with your supplier, manufacturer, or customs broker to get the correct HS code for your product.

2. Check the duty rate for your product in the destination country

You can use online tools such as the World Trade Organization’s Tariff Analysis Online (https://tao.wto.org/) or the U.S. International Trade Administration’s Export.gov (https://www.export.gov/article?id=How-to-Find-Tariff-Information) to search for the duty rate by HS code and destination country. You can also contact the customs authority of the destination country to get the most updated duty rate information.

3. Apply any preferential tariff treatment or trade agreement benefits that may apply to your product

Some countries offer lower or zero duty rates for certain products or countries under specific trade agreements or preferential tariff schemes. For example, the U.S. offers duty-free treatment for eligible products from certain developing countries under the Generalized System of Preferences (GSP) program (https://www.cbp.gov/trade/priority-issues/trade-agreements/special-trade-legislation/generalized-system-preferences). You can check if your product qualifies for any preferential tariff treatment or trade agreement benefits by using online tools such as the U.S. International Trade Administration’s FTA Tariff Tool (https://www.export.gov/FTA-Tariff-Tool) or by contacting the customs authority of the destination country.

4. Calculate the total amount of customs duty that you have to pay for your product

To calculate the total amount of customs duty, you have to multiply the HS code duty rate by the value of your product. The value of your product may include the cost of the product, freight, insurance, and other charges depending on the valuation method used by the destination country. You can use online tools such as the World Bank’s Doing Business Trading Across Borders Calculator (https://www.doingbusiness.org/en/data/exploretopics/trading-across-borders/trading-across-borders-calculator) or the U.S. Customs and Border Protection’s Duty Calculator (https://www.cbp.gov/travel/international-visitors/kbyg/customs-duty-info) to estimate the total amount of customs duty that you have to pay for your product.

Finding the HS code duty rate for your products is an important step in international trade. By knowing the HS code duty rate, you can plan your budget, optimize your pricing strategy, and comply with customs regulations.

Global Trends in HS Code Duty Rates

Harmonized System (HS) codes are a standardized way of classifying products that are traded across the world. They are used to determine the tariff rates and statistical categories for all merchandise imported into or exported from a country. HS codes are based on the international Harmonized System, which is the global system of nomenclature applied to most world trade in goods .

How HS Code Duty Rates Affect Global Demand

HS code duty rates are the taxes that are applied to imported or exported goods based on their HS codes. Duty rates vary depending on the origin and destination of the goods, as well as the trade agreements and policies of the countries involved. Duty rates can affect the global demand for certain products by making them more or less competitive in the international market. For example, lower duty rates can increase the demand for imported goods by making them cheaper for consumers, while higher duty rates can decrease the demand for exported goods by making them more expensive for foreign buyers.

Recent Changes in HS Code Duty Rates

In recent years, there have been several changes in HS code duty rates due to various factors, such as trade disputes, economic crises, environmental concerns, and political transitions. Some of these changes are:

The United States-Mexico-Canada Agreement (USMCA), which replaced the North American Free Trade Agreement (NAFTA) in 2020, updated the rules of origin and tariff schedules for trade among the three countries. The USMCA eliminated tariffs on most agricultural and industrial products, but maintained some tariffs on dairy, poultry, eggs, sugar, and steel and aluminum .
The United States-China trade war, which started in 2018 and escalated in 2019, resulted in both countries imposing additional tariffs on hundreds of billions of dollars worth of each other’s goods. The tariffs covered a wide range of products, including electronics, machinery, chemicals, textiles, agricultural products, and consumer goods. The trade war reduced the bilateral trade volume and demand between the two countries, as well as affected the global supply chains and markets .
The United Kingdom’s exit from the European Union (Brexit), which took effect in 2021, changed the trade relationship between the UK and the EU. The UK and the EU agreed on a Trade and Cooperation Agreement (TCA) that provides for tariff-free and quota-free trade on most goods, but also introduces new customs procedures and regulatory checks that may increase the costs and delays of trade. The TCA also does not cover some sectors, such as services and financial services, that are important for both economies .

Future Outlook for HS Code Duty Rates

The future outlook for HS code duty rates is uncertain and depends on various factors, such as the recovery from the COVID-19 pandemic, the resolution of ongoing trade conflicts, the development of new trade agreements, and the emergence of new challenges and opportunities. Some of the possible scenarios are:

A return to multilateralism and cooperation in trade policy, which could lead to lower HS code duty rates and more harmonized rules among countries. This could foster global trade growth and demand for a variety of products.
A continuation or escalation of protectionism and unilateralism in trade policy, which could lead to higher HS code duty rates and more divergent rules among countries. This could hamper global trade growth and demand for some products.
A shift to greener and more sustainable trade policy, which could lead to different HS code duty rates based on environmental criteria, such as carbon emissions, resource use, or waste management. This could create new incentives or disincentives for global trade and demand for certain products.

References:

http://www.wcoomd.org/en/topics/nomenclature/overview/what-is-the-harmonized-system.aspx

http://www.wcoomd.org/en/about-us/wco-members/membership.aspx

https://hts.usitc.gov/
https://www.cbp.gov/trade/priority-issues/trade-agreements/free-trade-agreements/USMCA
https://www.cfr.org/backgrounder/us-china-trade-war
https://ec.europa.eu/info/relations-united-kingdom/eu-uk-trade-and-cooperation-agreement_en

https://www.cbp.gov/trade/programs-administration/determining-duty-rates
https://hts.usitc.gov/
https://www.wcoomd.org/en/topics/nomenclature/instrument-and-tools/hs-nomenclature-2023-edition/hs-nomenclature-2023-edition.aspx
https://tao.wto.org/