Visit Our Sponsors
January 1, 2007 is an important date on the calendar for importers and exporters. That's when mandatory changes to the Harmonized Tariff System (HTS) go into effect, notes JPMorgan Chase Vastera. The global trade consultancy urged shippers to begin updating their product classifications immediately, in order to avoid "supply chain bottlenecks, possible sanctions and unexpected duty increases." Major changes to the HTS, enacted by the World Customs Organization, occur every five years or so. The latest updates are "massive," JPMorgan Chase said. Changes are due for 83 out of the 97 HTS chapters. They will likely force a revision in companies' import structures, "and will require significant administrative effort to implement." Companies that do nothing to prepare will find their entire classification databases rendered unusable, said Bernie Hart, global product executive with JPMorgan Chase. Accurate HTS code assignment is necessary because it determines the level of taxes imposed on goods as they move across borders. In the past, when changes were less sweeping, shippers could update their HTS classifications through "one-for-one" mapping. This time around, they will have to review each item to determine its appropriate classification.
Enjoy curated articles directly to your inbox.