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Understanding Harmonized System (HS) Codes

Genie Ng • Oct 12, 2022

Harmonized System (HS) Codes

The export of commodities frequently uses Harmonized System (HS) Codes, one of the systems used to classify industries. A uniform numerical system for classifying traded goods is known as the Harmonized System. Customs authorities use it all around the world to identify products when determining tariffs and taxes and collect data.


Why Are HS Codes Important For Global Trade?

Aside from aiding in the clearance of products through customs, these 6–10-digit numbers have several functions:


  • The correct HS code for your goods will be required in legal and commercial documents when undertaking trade. 
  • Customs authorities also use HS codes to track imports and exports and apply duties and taxes to products.


For more information, visit WCO trade tools.


Unanswered Questions About Hs Code For Malaysia

 

  • How can I find the correct HS codes?


Businesses can utilize the Jabatan Kastam Diraja Malaysia (JKDM) website to check and apply the appropriate HS Code if they are unclear on what to use in Malaysia.


Go to the Tariff page and click 'PDK(PERINTAH DUTI KASTAM)' in the Tariff Type column on the left to launch the search. Enter the primary keyword or code for the item that will be imported or exported after choosing either "Item Description" or "HS Code" under the Search Criteria tab.


  • What happens if you submit the incorrect HS Code?


Using the incorrect Harmonized Commodity Description can lead to errors in calculating customs charges, thus can increase overall shipping costs for importers and exporters.

 

The worst case scenario for incorrectly submitting Malaysia HS Codes is that the authorities might view the submission as a violation of customs laws, in which case the goods would need to be impounded, and an investigation would need to be opened.


In Malaysia, local authorities also have the authority to impose penalties, seize assets, or even revoke future import and export privileges.


  • Which HS Tariff Code should I use as an exporter—for country of origin or country of destination?


The HS Code list in Malaysia is a standardized categorization list utilized by over 200 economies from all participating areas. Individual nations, on the other hand, may choose to add extended codes after the six digits for additional categorization.


Using the JKDM website as an example, a fast search reveals that the HS Tariff Code for apples in Malaysia is 08.0810.00.00. The first six digits, 08.0810, is a standard international HS Tariff code, but the last four digits, 00.00, is a subdivision code that is added to the Malaysian customs’ HS Tariff Code.



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Trinity42 is an award-winning global trade solutions provider. We bring you solutions that help your business export beyond local regions. If you are interested in learning more about exporting your products to the overseas countries, contact us now! Our experienced global trade consultants will reach out to you with moving solutions that can help your business further!

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