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Harmonized System (HS) Code

The Harmonized Commodity Description and Coding System (Harmonized System or HS) is an international standardized system for classifying traded goods developed by the World Customs Organization. It uses a six-digit code to classify over 5,000 commodity groups. Over 98% of internationally traded goods are classified under the HS. While the HS and Indian Tariff Code (ITC) are based on the same structure, the ITC adds two additional digits to the six-digit HS code for national tariff and statistical purposes.

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Anand Verma
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500 views

Harmonized System (HS) Code

The Harmonized Commodity Description and Coding System (Harmonized System or HS) is an international standardized system for classifying traded goods developed by the World Customs Organization. It uses a six-digit code to classify over 5,000 commodity groups. Over 98% of internationally traded goods are classified under the HS. While the HS and Indian Tariff Code (ITC) are based on the same structure, the ITC adds two additional digits to the six-digit HS code for national tariff and statistical purposes.

Uploaded by

Anand Verma
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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The Harmonized Commodity Description and Coding System generally referred to as

Harmonized System or simply HS is a multipurpose international product


nomenclature developed by the World Customs Organization (WCO).
It comprises about 5,000 commodity groups; each identified by a six digit code,
arranged in a legal and logical structure and is supported by well-defined rules to
achieve uniform classification.
The system is used by more than 200 countries and economies as a basis for their
Customs tariffs and for the collection of international trade statistics. Over 98 % of
the merchandise in international trade is classified in terms of the HS.
The HS contributes to the harmonization of Customs and trade procedures, and the
non-documentary trade data interchange in connection with such procedures, thus
reducing the costs related to international trade.
It is also extensively used by governments, international organizations and the
private sector for many other purposes such as internal taxes, trade policies,
monitoring of controlled goods, rules of origin, freight tariffs, transport statistics,
price monitoring, quota controls, compilation of national accounts, and economic
research and analysis. The HS is thus a universal economic language and code for
goods, and an indispensable tool for international trade.
The Harmonized System is governed by The International Convention on the
Harmonized Commodity Description and Coding System. The official interpretation
of the HS is given in the Explanatory Notes (5 volumes in English and French)
published by the WCO. The Explanatory Notes are also available on online and on
CD-ROM, as part of a database which groups all the available HS Tools, by adding to
the information on the Nomenclature, the Compendium of Classification Opinions
and the Explanatory Notes, that relating to the Alphabetical Index and the Brochure
on Classification Decisions taken by the Harmonized System Committee.
The maintenance of the HS is a WCO priority. This activity includes measures to
secure uniform interpretation of the HS and its periodic updating in light of
developments in technology and changes in trade patterns. The WCO manages this
process through the Harmonized System Committee (representing the Contracting
Parties to the HS Convention), which examines policy matters, takes decisions on
classification questions, settles disputes and prepares amendments to the

Explanatory Notes. The HS Committee also prepares amendments updating the HS


every 5 6 years.
Decisions concerning the interpretation and application of the Harmonized System,
such as classification decisions and amendments to the Explanatory Notes or to the
Compendium of Classification Opinions, become effective two months after the
approval by the HS Committee. These are reflected in the amending supplements of
the relevant WCO Publications.

Difference between HS and ITC Code

Difference between HS number and ITC


number
What is the difference between Harmonized System code and Indian Tariff Code?
Are HS code and ITC code same?
Most of us in the trade believe that ITC code and HS code are the same. However, you may
read below the distinguish between HS number and ITC number.
What is H.S.code

H.S code system means Harmonized System code. In some


countries HS code is also known as HTS (Harmonized Tariff System)
. HS system has been developed by World Customs Organization
uniformly applied by more than 140 countries worldwide. H.S.code
classifies goods as 4 digit heading and 6 digit sub heading (four
digit heading followed by two digits). Customs department of more
than 140 major countries have been functioning on the basis of the
said 6 digit tariff code.

What is ITC CODE?

ITC means Indian Trade Classification, also known as Indian Tariff Code (ITC). This schedule
has two parts First schedule with an eight digit nomenclature and the second schedule
with description of goods chargeable to export duty. The first
schedule is based on H.S code system. The Indian Tariff
Code has 8 digit which has been designed in such a way
without any modification of first 6 digit as per H.S code system,
but followed by another two digit classified as tariff item. So
ITC has been classified as first four-digit code called heading
and every six digit code called subheading and 8-digit code
called Tariff Item. This addition is done, within the permissible
limit of World Customs Organization WCO, without any
changes in H.S.code system.
From the above clarification, it is not true that HS code and ITC code are same

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