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ARE YOU SHOPPING THE TARIFF SCHEDULE FOR THE BEST RATE?

2.5% or free of duty?  It can represent a large sum if the value is high and or the volume of entries is strong.  But picking harmonized tariff codes based on duty rates is not only incorrect, it is against the laws that govern trade.  The HTSUS (harmonized tariff schedule of the United States) is not a guide, it is a legal document backed with “teeth.” Failing to effectively classify commodities can lead to CF28’s (requests for information), CF29’s (notices of action often increasing the duty liabilities to the importer), focused assessments and audits.  All of these are efficiency killers in today’s modern fast paced supply chain environment. 

CF28’s take time and resources to provide appropriate answers to CBP.  CF29’s take time and resources to review, rebut and sometimes to apply subsequent payments to an entry that may already be completed and closed in the books.  Focused assessments and audits are a whole new level of resource taxing for an importer compared to CF28’s and 29’s. 

So what can importers do? 

First of all, importers should begin classifying according to the General Rules of Interpretation codified in the HTSUS.  These rules provide the framework to follow a process to obtain correct HTS codes. 

Second, importers should assess they database of commodities and determine items which need to be re-assessed.

Finally, an assessment of CF28’s and CF29’s should be examined.  How many have been received in the past 12 months?  How many have been answered? What items were affected by the requests? Have those items been updated inside the internal databases of the importer?

JAS Forwarding USA Inc. Compliance Team is experienced in all of these questions.  We have solved these problems and can help.  Contact us today and we will assist to analyze risk in this arena as well as others!

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