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Tariff codes are assigned to products for tax, customs, and statistical purposes by the World Customs Organization (WCO) through the Harmonized System. Each code can be divided into three sections and is used by national governments and international agencies for trade deals. The Harmonized System is available as a searchable database on the WCO website.
A tariff code is a number assigned to each type of product sold internationally. Each tariff code is issued by the World Customs Organization (WCO) through a database called the Harmonized System. The number of digits for each product ranges from six digits for common products to 10 digits for niche items. The Harmonized System comprises 21 sections and 96 chapters of product codes which must be used by WCO members to remain compliant with trade policies. Tariff codes are used for tax, customs and statistical purposes by WCO member countries.
The WCO was created in 1947 to address bureaucratic obstacles to international trade. This organization established the Harmonized System during the Convention on the Harmonized System in 1983. A new tariff code system was implemented in 1988 by 176 member countries. These codes make it easier for national governments to levy trade taxes or tariffs on other nations’ products. The WCO has integrated tariff codes into additional policies on trade harmonisation, customs integrity and economic security.
Each tariff code can be divided into three sections which determine the category and sub-category of the product. The first four digits of a fare code represent the general category of the product listed. The WCO adds two or four digits depending on the number of sub-categories within a product category. National governments can add two more digits to each product to track product trade for statistical reviews. The general rule is that each additional set of figures indicates an increasingly specialized type of product.
Tariff codes are not exclusively used by the WCO and national governments to collect taxes. A fare code could be a red flag for security officials charged with enforcing national trade restrictions. Customs officials may need to inspect perishable and hazardous materials as indicated by tariff codes. Importers and exporters use tariff codes to track the total number of products sold to international trading partners. National governments and international agencies could use tariff codes to collect statistics for trade deals.
The Harmonized System is available as a searchable database on the WCO website. This premium service allows businesses and government agencies to search fare codes at any time. Tariff codes in the Harmonized System can be found by keyword searches, code searches and chapter-by-chapter descriptions. The OMD allows subscribers to access the Harmonized System database for up to three years per paid subscription. Database users can also create access codes for up to 50 users during the subscription period.
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