Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (2023)

Update: US Customs and Border Protection (CBP) has delayed kicking off the US HTS code updates and revisions for 2022 until January 27, 2022 to give importers more time to prepare for the changes.

There are few topics that inspire as many questions among shippers as HTS Codes.

And that’s for good reason. When you’re tasked with classifying your goods from a list of over 21,000 items, it makes sense that many importers may find this system confusing.


But the good news is - the Harmonized Tariff Schedule (HTS) doesn't have to be nearly as complex as it sounds. The concept of HTS codes itself is relatively simple to explain. And there are a few quick tips that you can use to help determine how to apply HTS codes to your US import business.


So let us help demystify HTS codes for you. In this article, we’ll explain:


1.What an HTS code is and what they are used for
2.The difference between HTS codes and HS codes
3.Why it’s important to select the correct HTS code for your items
4.How to determine your HTS codes
5.Changes coming to the HTS code system in 2022


Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (1)

What are HTS codes? And why do we need them?


So just what are HTS codes, anyway? To put it simply, an HTS code is a number given to a specific imported item that helps identify and classify it. HTS codes also are used by governments to determine the amount of duty or taxes that must be paid to bring that item into the country. HTS stands for “Harmonized Tariff Schedule”, which is the list of all code classifications for traded goods.


Are HTS codes international or unique to the United States?
While the term “HTS” itself can be used to refer to tariff schedules in a variety of countries, the United States HTS code (abbreviated HTSUS) is the set of codes unique to the US. We will be using the HTSUS code list as the basis for our examples in this article.


A classification system
By identifying imports with standardized codes, governments (in the US, specifically the US International Trade Commission (ITC)) can make sure that the correct amount of duty is paid on those items and that there is relative fairness in trade across the board – product codes and duty amounts remain the same, regardless of the company or entity importing the items.

(Video) How to find HS Codes and Calculate Import Duty - 5 tips to save on Duties and Tariffs


Duty determination
Classifying imports using the HTS does more than determine duty, though. HTSUS codes are also used to track products coming into the country to help keep illegal or dangerous items from crossing US borders. For example, if an import alert is issued on raw 33-count cold-water shrimp that may be contaminated with salmonella, CBP agents can use their HTS classification – 0306.16.0006 – to track down the items that may be affected and detain them for further examination to make sure they’re safe.


Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (2)

What's the difference between an HTS code and an HS code?

You may be thinking, so that’s an HTS code – but then what is an HS code? You can think of HTS codes as localized versions of HS codes. “HS” stands for “Harmonized System”, and refers to the single, universal and global classification system for most traded goods and products.


What is an HS code?
HS codes are used in most shipping processes internationally. They are six digits long and consist of a chapter and heading.


How is an HTS code different from an HS code?
HTS codes, on the other hand, are ten digits, and are made up of a chapter, heading, and up to three subheadings. The first six numbers are the item’s HS code, but the additional numbers are unique to the country of import and serve to further divide and classify the goods.

Let's take a closer look at HTSUS codes


Take a look at the graphic below, using footballs as our example, for a visual breakdown of the elements that make up an item’s HS and HTSUS codes.


1) Chapter
Chapters are the first classification layer in the HS code and HTS code systems. There are currently 99 chapters in the international HS code list, grouped into 29 general sections like “Section 20: Miscellaneous Manufactured Articles”, where you will find Chapter 95 for “toys, games, and sports equipment”. An item’s classification chapter is indicated in the first two digits of its HS/HTS code.

(Video) HTSUS Classification

2) Heading
Chapters are further divided into headings, which help narrow down the items in the category. For example, “toys, games, and sports equipment” can be subdivided into “Articles and equipment for general physical exercise.”

3) HTS Code/Subheading
You can see that row three, where you find the six-digit “subheading” for classifying footballs, is the item’s global HS code. These six numbers can be pretty much universally used around the globe on a higher level to classify footballs almost anywhere you ship them.


Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (3)

4) First US Subheading: Rate Line
Moving further down, the eight-digit subheading, sometimes called a “rate line”, is unique to the US and helps CBP determine the duty you will pay on the items.

5) Second US Subheading: Statistical Suffix/Category
The final ten-digit “statistical suffix” or “category” is a more detailed description of the item and is used for trade data collection.


In this example, the eight- and ten-digit codes are what make this a US HTS code – these additional numbers on the code are only valid in the US. Other countries may use the same first six digits (9506.62) to classify footballs, but if those countries have their own tariff code systems, any additional numbers may be different from those we see in the US HTS code.

Why does choosing the right HTS code matter?


Remember: HTS codes determine the duty you pay
Using our example of footballs and the current list of US HTS Codes, there would be a big difference between reporting your pallet of footballs as 9506.62.40 (Inflatable balls – footballs and soccer balls), which can be imported duty free, and reporting it as 9506.62.80 (Inflatable balls – other), for which you would pay a 4.8% import tax.


Other countries won’t recognize HTSUS codes
In addition, you have to be careful not to use US-only HTS codes for items you are shipping to other countries. Other countries have their own variations of HTS codes, and though they may look similar to US HTS codes, they will be different, and the number used to describe an import in the US may mean something very different in another country. For example, if you tried to ship a pallet of footballs to China, and reported them as 9506.62.4040, your shipment would be rejected because in China, the code to classify footballs is 9506.62.1000.


It’s the importer’s duty (pun intended)
The US Customs Modernization Act states that an importer is responsible for filing customs entries with accurate values and estimated duties, and it is therefore technically illegal to misclassify your goods. If you are found to be doing so you may face serious fines and penalties as a result.

But what about those "Schedule B" codes?


So that covers HTS and HS codes. But then what about those “Schedule B” codes?
Simply put, while HTS codes are used to classify imports, Schedule B codes are used to classify exports.


Schedule B and HTS codes: What’s the difference?
Schedule B codes are ten-digit numbers used by the US Census Bureau (rather than the ITC) to monitor US exports. An item’s Schedule B is similar to its HTS code, where the first six digits are identical to the international HS code. However, its last four digits may be different. The code lists are not identical, and HTS codes tend to be more detailed, so the HTS code list is a bit lengthier than the list of Schedule B codes.


Are Schedule B codes and HTS codes interchangeable?
Schedule B codes are used by exporters in their paperwork and on forms. You can sometimes use HTS codes when exporting (rather than classifying items twice – once for HTS and once for Schedule B), but Schedule B codes cannot be used in place of HTS codes for items imported into the US. For more details about the differences between HTS codes and Schedule B codes, as well as explanations of when it may be appropriate to use one or the other, visit theUS Census Bureau’s Foreign Trade site.


Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (4)
(Video) 2022 HTS Updates

How to determine your HTS code


HTS codes narrow descriptions of goods and items down to a very nuclear level. That is generally the point of using them. But that same quality that makes the HTS code greatly efficient at helping CBP classify imports can also make it very difficult and confusing for shippers to categorize their items.


Here are a few tips to get you on the right track:


1) Know your product. To even begin to assign HS or HTS codes to a shipment, you have to know everything about it. And we mean everything – what it’s made of, how big it is, what it does and doesn’t do, and any other specifications unique to it.

2) Start at the top and work your way down. The classification system can seem less daunting if you think of it in segments. So start with determining the right chapter for your goods – this is usually the easiest part. Then move down the list section by section.

(Video) HS 2022 - how commodity codes may change next year

3) Read the notes. Once you determine which chapter your goods will most likely be assigned to, it’s important to read the notes at the beginning that provide specific guidance on line items within the section.

4) Use Ctrl + F. Thanks to the US International Trade Commission, the entire HTS Code list is available (and searchable) online here. You can use the website’s search function to dynamically sort through the codes, or if you can identify what chapter your goods belong in, you will be able to download a complete PDF version of that section. Once you’ve done that, you can easily use the keyboard shortcut “Ctrl + F” to generate a search bar, and just type in a word or words that would help narrow down the search. For example, using Ctrl + F in Chapter 95 (Toys, Games and Sports Equipment) to search for “football” quickly brings us to Heading/subheading 9506.62.40 (“Footballs and soccer balls”).

5) Compare and contrast. Even if you think you have found the correct heading, it’s a good idea to read through all related headings in a chapter to make sure there isn’t one that better fits your product. The same applies to subheadings – compare all that are there and select the one most relevant to your items.

6) Know your GRIs. There are six GRIs, or General Rules of Interpretation, that exist to provide guidance on classifying your goods. These rules cover some “basics”, like that classifications apply to items whether they are finished or unfinished, that cases shaped to fit specific items like musical instruments should be classified with the items they are meant to store, and that items should be classified into the category “to which they are most akin”, or similar.1

7) Ask an expert. You can consult with the US Commercial Service, which is a part of the US Department of Commerce’s International Trade Administration (ITA) for help classifying your items. In addition, if you outsource your shipping to a knowledgeable freight forwarder, that company will likely have access to customs and brokerage experts who can help you with the policies and procedures associated with that process.

8) When all else fails, request a ruling. If you are still stumped, you can submit a request to CBP to have them consider your items and issue a Ruling Letter telling you how your goods should be classified. Make note, however, that once you receive an official ruling from CBP, you must classify your items in the manner/classification they have selected. You can learn more about requesting a CBP ruling here.


Importer’s Guide to HTS Codes | UPS Supply Chain Solutions (5)

HS and HTS Codes in 2022: What you need to know

On January 1, 2022, new changes to the World Customs Organization’s Harmonized System will take effect, adding over 70 headings and subheadings, including new classifications for items like smart phones and 3D printers.2 These changes will of course inevitably trickle down to the US HTS, which will welcome over 1,500 codes to its list.3


The HS code system is reviewed at least every five years, and the World Customs Organization explained that upcoming changes were made to address new technology and world factors, including provisions for new health and safety equipment, drones, and more. It’s important to review the changes before the deadline to make sure that your goods are still being properly classified.


Thomson Reuters put together a nice summary of the changes coming to the HS next year, which you can view here. And to see how the codes have changed and determine whether a new code is needed to classify your products, check out the World Customs Organization’s 2017-2022 Correlation Tables.

(Video) HTSUS Classification Webinar


If the thought of trying to choose an HS or HTS code for your goods still seems overwhelming, learn how UPS Supply Chain Solutions® can help simplify the import/export process for you.
More About UPS Customs Brokerage

Concerned about classification in 2022? STTAS, a UPS company, can help you navigate the upcoming tariff changes. For more information, visit the STTAS website.
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FAQs

How do I find the HTS code for a product? ›

One of the common ways to find an HTS code, particularly if you're set on doing the work yourself, is to use USA Customs Clearance's HTS code lookup tool. You can input an item or keyword into the search bar and the tool will pull up a list of potential matches and their corresponding codes.

What is HS code for UPS? ›

Uninterruptible Power Supply Import Data under HS Code 85044090 with Price. Seair Exim Solutions is providing Uninterruptible Power Supply import data of HS code 85044090. HS code 85044090 Import data and product(s) under 85044090 HS code is collected from Indian customs, ports, and other reliable authorities in India.

How do I read HTS codes? ›

HTS code. A 10-digit code that categorizes each imported good. The first six digits are an HS code. The subsequent two digits identify the US subheading of the HS code to determine the duty rate, while the final two digits are a statistical suffix.

What is the difference between HTS code and HS code? ›

The difference between an HS code and HTS code is the number of digits within the code. A code with six digits is a universal standard (HS Code) and a code with 7-10 digits (HTS Code) is often unique after the 6th digit and determined by individual countries of import.

Are HTS codes the same for import and export? ›

The initial six digits of HTS Code (which is the HS Code) and Schedule B numbers will always be the same for particular products. Though Schedule B Codes and Harmonized Tariff Schedule Codes may seem very similar, HTS Codes are used for import categorization and Schedule B Codes are used for export categorization.

Who assigns HTS codes? ›

Who Determines HTS Codes? The codes are governed by the WCO and are updated every five years. The WCO has assigned every product and its classification a specific six-digit code. For further classifications, countries are allowed to add longer codes to the first six digits.

What is HS code in supply chain? ›

HS Code stands for Harmonized System Code. It is an international index used for categorizing goods, enabling consistent classification and taxation. The HS Code consists of 21 sections and numerous subsections that allow shippers to describe their goods in great detail using only numbers.

What is a HTS code for shipping? ›

HTS stands for Harmonized Tariff Schedule, a classification system used in the United States to help determine customs duties to be paid on imports. HTS codes are 10-digits (the first six digits are the same as the HS code for the goods). The HTS is published by the US International Trade Commission (ITC).

What is a 6 digit HS code? ›

At the international level, the Harmonized System (HS) for classifying goods is a six-digit code system. The HS comprises approximately 5,300 article/product descriptions that appear as headings and subheadings, arranged in 99 chapters, grouped in 21 sections. The six digits can be broken down into three parts.

What happens if you use the wrong HTS code? ›

Using the wrong HTS will result in an incorrect payment of duties whether too little or too much, this creates an issue for CBP in their revenue collection mission and may result in them issuing penalties for failure to provide correct and accurate information to CBP.

Are HTS codes changing for 2022? ›

The HTS updates are to go into effect for all entries into the U.S. on or after January 27, 2022. These modifications are based on the World Customs Organization's 2022 Harmonized System Tariff nomenclature and include over 1500 new headings and subheadings across the 97 chapters of the HTS.

How do you read a 8 digit HS code? ›

In the 8 digit structure of an HSN Code, the first 2 digits define the Chapter, at 4 digit level are the headings, at 6 digit are the subheadings and finally at 8 digit are the tariff items.

How many HTS codes are there? ›

There are approximately 19,000 HTS codes, compared to about 9,000 Schedule B codes. The additional detail for HTS classifications means multiple HTS numbers can correlate to a single Schedule B number.

How many types of HS codes are there? ›

How many Harmonized System (HS) shipping codes are there? There are approximately in circulation 5,300 HS codes that identify export goods that are broken down into headings along with subheadings. They are also arranged into 99 different chapters around with being grouped into 21 sections.

Is HTS code universal? ›

HS codes are universal while HTS codes are country-specific. They are both used to classify imported goods on a global scale.

Can a product have more than one HTS code? ›

You can only submit one Harmonized System (HS) code per container. However, when arranging export and import customs clearance, we would require the full list of Harmonized System (HS) codes to be used for clearing all the different types of commodities the container contains.

Do I need a HS code for customs? ›

Using a HS Code on a commercial invoice ensures that exports make it through customs seamlessly and without delay. That way, importers will receive their goods faster and exporters are paid sooner. Failure to place the HS Code on the commercial invoice could risk the importer paying the incorrect tax.

Is HS code required for export? ›

While exporting or importing, it is mandatory to include your product's HS code in your shipping documents, such as your commercial invoice, packing list and shipping bill. And as an exporter or importer, it is your legal responsibility to correctly identify your product's HS code.

Is HS code same for all countries? ›

In other words, first six digits of HS code (HTS code) are same in all countries. But countries can add additional digits to categorize and define commodities at more detailed level without modifying or changing first six digits.

What is a 10 digit HS code? ›

You will need to use the Harmonised System ( HS ) to classify your goods and check they meet the rules of origin. It is an internationally standardised system of description and numbers and forms the first part of the: 10-digit commodity code used to classify goods when importing them into the UK.

Do I need HS code for shipping? ›

The Harmonized System (HS) is a global product classification system. To export, you will need to know the HS Code for your product.

What is HTS on an invoice? ›

The Harmonized Tariff Schedule of the United States (HTS) sets out the tariff rates and statistical categories for all merchandise imported into the United States. The HTS is based on the international Harmonized System, which is the global system of nomenclature applied to most world trade in goods.

Is HS code first 6 digits of HTS code? ›

HTS (Harmonized Tariff Schedule) codes are product classification codes between 8-10 digits. The first six digits are an HS code, and the countries of import assign the subsequent digits to provide additional classification. U.S. HTS codes are 10 digits and are administered by the U.S. International Trade Commission.

What is 4 digit and 6 digit HSN code? ›

Headings (4 digits HS), subheadings (6 digits HS), and tariff items are all categorised under HS codes in Customs Tariffs (8 digits). Furthermore, the GST portal includes an HSN search function. HSN Codes are extensively used by manufacturers and importers/exporters.

Does HS code have to be 10 digits? ›

An H.S. Tariff Classification Number is a 10 digit number that must be provided on import documentation in order to communicate what is the good that is being imported. Theoretically, every type of good is covered by the H.S.

How often do HTS codes change? ›

The HS nomenclature is updated every five years, with the most recent update in 2017. The Harmonized Tariff Schedule of the United States (HTS) was enacted by Congress and made effective on January 1, 1989, replacing the former Tariff Schedules of the United States.

Can I declaring a lower value for customs? ›

If you declare a lower value for the customs and don't give any proof for it, the customs officers can estimate the value of the products and charge higher fees for them. Therefore, you might end up paying a lot more for the undervalued goods declared to customs. You will receive a fine for tax evasion.

What does an HTS code look like? ›

An HTS code takes the same form as an HS code for the first six digits, and then has four differing last digits. Use Case: If you are a U.S. importer, this is the code you must use. The comprehensive classification list available for free on the ITC website.

Who can use 8 digit HSN code? ›

Businesses can, however, optionally include the HSN code at additional digits. Businesses with up to 5 crores can use HSN at 6 or 8 digits, while businesses with more than 5 crores can use HSN at 8 digits.

What do the first two digits of HS code represent? ›

The first two-digits in the code are known as 'chapter codes'. These digits are used to categorise the item in question so it can be identified in one of the 99-chapters. Heading numbers are the second two-digits in the HS code structure.

What is HS code and how it works? ›

HS stands for Harmonized System and identifies product categories and products with a standardized two- to six-digit nomenclature. The first two digits of the code indicate the product category. The next four to six digits indicate the subcategories the product fits into.

What is another name for HS code? ›

The Harmonized Commodity Description and Coding System, also known as the Harmonized System (HS) of tariff nomenclature is an internationally standardized system of names and numbers to classify traded products.

What is an HTS code for shipping? ›

What is an HTS Code? HTS stands for Harmonized Tariff Schedule, a classification system used in the United States to help determine customs duties to be paid on imports. HTS codes are 10-digits (the first six digits are the same as the HS code for the goods).

Do you need HTS code for export? ›

In regards to whether an HTS Code is needed for exports, the answer can be clearly explained. HTS (Harmonized Tariff Schedule) codes are not used for exports. HTS codes are used to import products, while export codes, also known as Schedule B codes are used to export products.

What is HS HTS code in shipping? ›

The HTS code or HS code are part of a worldwide standardized system of classifying goods in international trade. They are also know as a Harmonized System Code or a Tariff Code.

Why do we need HTS codes? ›

To put it simply, an HTS code is a number given to a specific imported item that helps identify and classify it. HTS codes also are used by governments to determine the amount of duty or taxes that must be paid to bring that item into the country.

Do all products have a HS code? ›

HS codes are recognized in 98% of world trade. There are six digits in an HS code. You use an HS code because it is a universal classification tool. Many governments add additional digits to the HS number to further distinguish products in certain categories.

Do I need HS code to ship internationally? ›

When you are looking to ship a product overseas, it is a legal requirement that you have a six digit HS code. This doesn't change whether you are shipping t-shirts or cars, every product must be assigned the HS code.

What items are exempt from import duty? ›

If you receive an imported gift by mail that is worth CAN$60 or less, you will not have to pay duty and/or tax on it.
...
Items that do not qualify for the CAN$60 gift exemption include the following:
  • tobacco;
  • alcoholic beverages;
  • advertising material; and.
  • items sent by a business.
13 Aug 2021

What is a 10 digit HTS code? ›

HTS (Harmonized Tariff Schedule) codes are product classification codes between 8-10 digits. The first six digits are an HS code, and the countries of import assign the subsequent digits to provide additional classification. U.S. HTS codes are 10 digits and are administered by the U.S. International Trade Commission.

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