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Abstract Harmonized System
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Added on 2020-03-16
Abstract Harmonized System
Added on 2020-03-16
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Running Head: HARMONISED SYSTEM 1Harmonized System-Nomenclature and Classification of Parts and AccessoriesName:Institution Affiliation:
HARMONISED SYSTEM 2AbstractHarmonized system is an international multipurpose product nomenclature that was developedby World Customs Organizations (WCO) to classify the traded goods. It is thus a universallanguage of economics and the code for goods, and an essential tool in the international trade.The harmonized system uses two major ways in the classification of the products which includean algorithm which provides concordances between ten-digit Harmonized System codes and theSIC, and the other way is the HS codes and the SIC product or good used for the classification ofUnited States manufacturing production. This work focuses of revealing how the HS systembenefits majority of the states that have implemented it especially in their trade matters be it localor international trade. The challenges that surround the classification of parts and accessories inthe goods classification process are real and need to be dealt with accordingly early enoughbecause these affect the international financial and the economy of the country and these effectsare strongly felt especially on the economy of the region.IntroductionHarmonized system is an international multipurpose product nomenclature that wasdeveloped by World Customs Organizations (WCO) to classify the traded goods (WCO, 2017).The parts and accessories are products of metallic in nature. For instance, when referring toautomotives are the non-essential parts that add to the functionality of the automotive accordingto (World Customs Organization, 2017). Goods like the parts and accessories must always beclassified under a specific tariff by choosing the item numbers that should be accompanied bylanguage descriptions that are the most appropriate and more specific to that particular product.The item number that is selected gives the amount of the duty that is to be put on goods. Despite
HARMONISED SYSTEM 3the fact that several merchandise descriptions are provided in the available tariff statutesdisputes, do arise in the classification process of goods (HS 2002 Classification by Section(Classifications, Commodity Codes, Commodity Description, HS 2002, HS code search), 2017).The conflicts do arise from three major issues that include the determination of the appropriatetariff term meaning, deciding on the classification of the article that is covered by several itemnumbers. These items are more than one, and the final problem that arises in the classification ofgoods is the classification of the new product that was initially not in existence now that tariffwas adopted (What is a tariff code?: UPS, 2017). Incorrect classification usually results in theimposition of border penalties or the seizures and the non-compliance penalties.Classification systems of Harmonized SystemsIn the process of approaching the issues that make the classification of goods a head,tools have been provided to improve the data that exists in two major ways (HarmonizedCommodity Description and Coding Systems (HS) (Classifications, Commodity Codes,Commodity Description, HS, HS code search, WCO), 2017). An algorithm which providesconcordances between ten-digit Harmonized System codes that are used in the classification ofgoods in the international trade in the United States and SIC industry codes to classify theeconomic activities which are domestic. The other concordance is that between the HS codes andthe SIC product or good used for the classification of United States manufacturing production.Importance of the Harmonized system200 countries and more as the basis for the customs tariffs and the purpose of collectionof the international statistics of trade use the HS system, and more than 98% of the merchandisein the international trade uses the HS as the classification terms. The other benefit of the HS
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