Definition
The most important instrument of customs policy is the customs tariff and the customs tariff number. This is subject in each case to a tariff scheme. Only when the codes and numbers of the tariff scheme have been assigned tariff rates are they considered a tariff. The subdivision takes place either according to
- the branches of production to which they belong (production principle) or according to
- the principle of intended use (e.g. all machines or toys combined).
In countries with a wide distribution of production, tariffs are usually used, which are arranged in types and sub-types of goods:
- Single tariffs (have only one tariff column)
- Dual tariffs (have two tariff columns, e.g. a general tariff with a higher level and a minimum tariff with tariff rates that form the lower limit of tariff concessions to other countries)
The Common Customs Tariff of the European Community shows one column each for autonomous and for conventional duties.
General information about the customs tariff number
The customs tariff is a systematically structured list of goods (nomenclature). All possible trade goods (in cross-border traffic) are listed in this customs tariff scheme. Each good is assigned to a specific code number. An accurate classification of the goods in the customs tariff is necessary so that everything can be cleared smoothly. In the area of importation, the description of goods is coded up to an 11-digit code number during tariff classification. For market regulation purposes or also in the area of export up to an 8-digit commodity code number. Each code number contains the scale for the resulting customs duty amount, the customs duty rates.
Apart from tariff rates, other legal consequences related to cross-border movement of goods can be derived, e.g. whether:
- Prohibitions and restrictions must be observed
- The import or export must be approved or requires a license
- Separate foreign trade statistics are required
- Additional documents must be submitted for further customs treatment
- Certain measures must be reported
- The goods are subject to anti-dumping regulations
- A quota or tariff suspension may be claimed
Code number – Customs tariff number – Commodity tariff number – TARIC code (Tarif Intégré des Communautés Européennes) – HS code
What is the difference?
You come across these different terms everywhere, but what do they actually mean? The English equivalents such as Customs Tariff Code, Customs Tariff Number or Product Code are also frequently encountered in foreign trade.
Basically, we are always talking about the same 11-digit number, which is composed of the different sequences. The number represents a classification of the World Customs Organization for goods in a numerical assignment in international trade. Every good can be assigned to a number in this way, e.g. via the Electronic Customs Tariff. Once the correct customs tariff number has been determined, it can be used, for example, to determine import duty rates throughout (almost) the entire world.
Guide to the correct procedure for the tariff classification of goods
The list of commodity codes (or also called commodity tariff numbers) is called the Harmonized System (HS), hence the term HS code.
Legal
The legal basis of the Customs Tariff is Regulation (EEC) No. 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff. This regulation introduced the Combined Nomenclature (CN) and used it as the customs tariff nomenclature and statistical nomenclature. It is directly applicable in every EU member state. The twelfth article of the regulation stipulates that the European Commission must publish the complete version of the CN (combined with the customs rates) every year in order to always be able to insure the current status. By 31 October of the year at the latest, an up-to-date regulation is published in the Official Journal of the European Community and applies from 1 January of the following year.
Structure of the code number
The basis of the 11-digit code number is the Harmonized System (HS). This is administered by the World Customs Organization (WCO) and determines the first six digits of the code number. The HS is based on the same classification of goods worldwide and designates and codes the goods.
The first six digits of the code are followed by two digits determined by the Combined Nomenclature (CN). With the help of this 8-digit number, customs duties, textile categories, prohibitions and restrictions or import permit starting stocks can be assigned during import clearance.
The so-called TARIC (=Integrated Tariff of the European Community) forms the ninth and tenth digits and codes Community measures (e.g. anti-dumping regulations, tariff suspensions or tariff quotas). According to Article Two of the Regulation, the TARIC is established by the Commission.
The eleventh digit serves national purposes and encodes, for example, sales tax rates or national prohibitions and restrictions.
In an export declaration, the 8-digit commodity code is sufficient; in an import declaration, the 11-digit number must always be indicated.
Example based on a bound children’s book:
| Code number | Formal structure |
| 49 | Chapter – Harmonized System |
| 4901 | Position – Harmonized System |
| 4901 99 | Subheading – Harmonized System |
| 4901 9900 | Subheading – Combined Nomenclature |
| 4901 9900 00 | Subheading – TARIC/Community specifics |
| 4901 9900 00 9 | Code number – electronic customs tariff/national specifics |
In the areas of market regulation law and excise duties, the 11-digit number can be supplemented with an additional 4-digit code for certain goods in order to identify the goods more precisely.
Sources:
https://wirtschaftslexikon.gabler.de/definition/zolltarif-50220
https://www.zoll.de/DE/Fachthemen/Zoelle/Zolltarif/Informationen-Zolltarif-Codenummer/informationen-zolltarif-codenummer.html
