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CHAPTER XVII CHAPTER XVII HARMONIZED TARIFF SCHEDULE HARMONIZED TARIFF SCHEDULE

OF THE U.S. (HTSUS)OF THE U.S. (HTSUS)

Harmonized System Structure of the HTSUS Columns of the HTSUS Commingling of Goods General Rules of Interpretation Types of Customs Duty

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Harmonized SystemHarmonized System Harmonized Commodity Classification & Coding

System, in short, Harmonized System (HS) Uniform international tariff nomenclature

system Adopted by Customs Cooperation Council

(CCC), which was established in 1952 and became World Customs Organization (WCO) in 1994

Obligations of WCO members Undertake to conform the country’s import and

export trade nomenclature to the language and numerical code of the Harmonized System

Apply general rules of interpretation and section and chapter notes

Make import and export statistics publicly available

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Harmonized SystemHarmonized System

Structure of Harmonized System Consisting of 97 chapters and 21

sections Covers 5,000 article descriptions Contains

• General Rules of Interpretation• Section Notes• Chapter Notes

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Structure of Harmonized Tariff Structure of Harmonized Tariff Schedule of the U. S. (HTSUS)Schedule of the U. S. (HTSUS)

99 Chapters and 22 Sections Effective January 1, 1989 in the U.S. by the

Omnibus Trade Act of 1988 Chapter 98: Special Classification Provisions Chapter 99: Temporary legislation & modifications Pay attention to the notes of each section and

chapter HTSUS is published by U.S. International Trade

Commission (USITC) and administered by U.S. Customs & Border Protection (USCBP)

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Columns of HTSUSColumns of HTSUS

1) Number Column Heading/Subheading Column

• 4-digit heading number: General description

• 8-digit subheading number: Detailed description & rate of duty

• First two digits indicate chapter number

Statistical Suffix: 2-digit statistical reporting number

Columns of HTSUSColumns of HTSUS

2) Article Description Column General description: 4-digit number Detailed description: 8-digit number

3) Unit of Quantity Column Metric Measurement System such as kg,

m, l, doz, gross

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Columns of HTSUSColumns of HTSUS4) Rates of Duty Column

Column 1: The Normal Trade Relations (NTR) (formerly Most-Favored-Nation, MFN) status conferred by the United States • General subcolumn : Rates of duty for

imports from the NTR nations not entitled to special tariff treatment

• Special subcolumn: More generous special rates of duty for special tariff treatment programs of the USA

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Rates of Duty ColumnRates of Duty Column Column 1 Special subcolumn:

Generalized System of Preferences----A, A*, A+

Automotive Products Trade Act------------------B Agreement on Trade in Aircraft-------------------C North American Free Trade Agreement

• Goods of Canada----------------------CA • Goods of Mexico-----------------------MX

African Growth & Opportunity Act---------------D Caribbean Basin Economic Recovery

Act-------------------------------------------------------E, E*

U.S.-Israel Free Trade Agreement----------------IL

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Rates of Duty ColumnRates of Duty Column Column 1 Special subcolumn (continued)

Andean Trade Preference Act------------------J, J* U.S.-Jordan Free Trade Agreement------------JO U.S.-Caribbean Basin Trade Partnership

Act----------------------------------------------------------R U.S. – Singapore Free Trade Agreement-----SG U.S. – Chile’ Free Trade Agreement------------CL U.S. – Australia Free Trade Agreement-------AU U.S. – Morocco Free Trade Agreement-------MA Dominican Republic-Central America

Free Trade Agreement (DR-CAFTA)------------ P

Rates of Duty ColumnRates of Duty Column

U.S.-Bahrain Free Trade Agreement-----------BH U.S.-Oman Free Trade Agreement--------------OM U.S.-Peru Trade Promotion Agreement--------PE U.S.-Korea Free Trade Agreement---------------

KR U.S.-Colombia Trade Promotion Agreement-CO

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Rates of Duty ColumnRates of Duty Column

Column 2: Non-NTR nations as of 1/1/2011

• Cuba, North Korea

Latest NTR: Vietnam in December 2001 and Laos in February 2005

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Commingling of GoodsCommingling of Goods

Highest rate of duty among commingled components

8410.30.10 Check valve of copper………………….………….3%

8410.30.20 Check valve of iron or steel………………….………….…5%

Check valve of copper & iron…?

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General Rules of InterpretationGeneral Rules of Interpretation

(1) Titles of sections, chapters and subchapters are provided for ease of reference only. Most goods can be classified according to language as it appears.

(2) Incomplete or unfinished articles that have essential character of complete or finished articles that are unassembled are classified as complete or finished articles

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General Rules of General Rules of InterpretationInterpretation

(3) Goods are described in two or more tariff headings a. Relative specificity-The most specific

description 6405.10.00 Shoes with leather……………..10.0% 9021.90.80 Shoes, Orthopedic …………….Free

b. Essential character-Mixtures or composite goods of different materials put up for retail sale

Gift packages of wine, cheese and pears Kits of fingernail clippers, razor blades,

scissors, toothpaste, etc c. Last in numerical order

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General Rules of InterpretationGeneral Rules of Interpretation

(4) Goods that cannot be classified under the above rules shall be classified under the heading appropriate to the goods

(5) Cases like camera cases, musical instrument cases or gun cases imported with a specific article designed for shall be classified under the heading of that article

(6) Comparisons have to be made at the equivalent level. 8-digit heading to 8-digit heading

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General Rules of InterpretationGeneral Rules of Interpretation

(7) A tariff classification controlled by use is to be determined by the principal use at or prior to the date of importation

(8) A tariff classification controlled by the actual use is satisfied only if such use is intended at the time of importation.

(9) A specific provision for parts prevail over a provision for parts of an article.• 8512.40.40: Windshield wipers, 2.5%• 8708.99.49: Parts of motor vehicle, Other, Free

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GGeneral Rules of Interpretationeneral Rules of Interpretation(10) Mixtures of two or more textile materials per Note 2 of Section XI: Textile products classified as if consisting

wholly of that one textile material which predominates by weight over each other single textile material

• 5007.10.30 Woven fabrics of silk containing 85 percent or more by weight of silk or silk waste---0.8%

• 5208.11.20 Woven fabrics of cotton containing 85 percent or more by weight of cotton------------------7.0%

• 6110.30 Sweaters of man-made fibers • 6110.30.10: Containing 25% or more by weight of

leather-----------------------------------------------------6.0%• 6110.30.30: Other------------------------------------32.0%

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Types of Customs DutyTypes of Customs Duty

(1) Ad Valorem Duty According to the value Percentage of entered value

Based on FOB price 6105.10.00: Men's or boys' shirts, knitted or

crocheted, of cotton--: 19.7% (General, NTR), Free (BH,CA,CL,IL,JO, MX,P,PE,SG), 8% (AU), 45% (Column 2, Non-NTR)), January 1, 2011

Country FOB price Rate Duty

NTR $10,000 19.7% $1,970.00

BH---SG $10,000 Free 0.00

AU $10,000 8% $800.00

Non-NTR $10,000 45% $4,500.00

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Types of Customs DutyTypes of Customs Duty

(2) Specific Duty Duty per unit of quantity such as kg or each of

imported goods Regardless of price 2008.20.00: Pineapples---0.35¢/kg (General,

NTR), Free (A+, AU, BH, CA, CL, D, E, IL, J, JO, MA, MX, OM, P, PE, SG), 4.4¢/kg (Column 2, Non-NTR), January 1, 2011Country Net Weight Rate Duty

NTR 10,000 kgs 0.35¢/kg $35.00

A+---SG 10,000 kgs Free 0.00

Non-NTR 10,000 kgs 4.4¢/kg $440.00

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Types of Customs DutyTypes of Customs Duty

(3) Compound Duty Combined duty of ad valorem duty and specific duty 9614.00.25: Smoking pipes and cigar or cigarette

holders of wood or root: 0.4¢ each+ 3.2% (Genera, NTR), Free (A, AU, BH, CA, CL, E, IL, J,JO,MA,MX,OM,P,PE,SG), 5¢ each + 60% (Column 2, Non-NTR) (January 1, 2011)

Country Quantity FOB price Rate DutyNTR 2,000 pcs $10,000 0.4¢/ea 8.00

3.2% 320.00

$328.00A---SG 2,000 pcs $10,000 Free 0.00

  Non-NTR 2,000 pcs $10,000 5¢/ea 100.00 60%6,000.00

$6,100.00

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Types of Customs DutyTypes of Customs Duty 6203.19.20: Men's or boy’s suits of artificial fibers

containing 36% or more by weight wool or fine animal hair– 52.9¢/kg + 21% (General), Free (BH,CA,CL,IL,JO,MA, MX,OM, P,PE,SG), 8% (AU), 52.9¢/kg +58.5% (Column 2 ) (January 1, 2011)1,000 suits at $50.00 each and 2 kgs each

Country Quantity FOB price Rate Duty

  NTR 2,000 kgs $50,000 52.9¢/kg 1,058.00 21% 10,500.00

$11,558.00BH--- SG 2,000 kgs $50,000 Free 0.00

AU 2,000 kgs $50,000 8% $4,000.00

Non-NTR 2,000 kgs $50,000 52.9¢/kg 1,058.00 58.5% 29,250.00

$30,308.00

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