• HS Codes & Import Duty Rates in China: The Ultimate Guide

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    Exporting to China requires thorough planning and that you manage product testing, labelling, preparation of documents needed, and more.

    What many exporters know little about are HS codes. What are HS codes and why do I need them?

    HS codes are used internationally for a number of important reasons, you won’t be able to clear the customs without them.

    In this article, I explain all crucial information you need to know about HS codes and the import duties used for different HS codes in China.

    What are HS codes?

    The word HS codes is an abbreviation from Harmonized Commodity Description and Coding System, the codes are used to classify products traded in a country.

    In China, HS codes are divided into 22 categories, which are in turn divided into 98 chapters. The 98 chapters are thereafter divided into around 5000 subheadings.

    Some people think that HS codes are only used in China, but that’s not the case, the codes are used internationally. However, the appearance of the code might differ, for example, the amount of digits used.

    How many digits are used in HS codes?

    From wikipedia’s description, HS codes only consist of 6 digits. This is the standard but the number of digits differs between countries.

    For example, in China HS codes normally have 10 digits and in ASEAN they use 8 digits.

    Why do I need HS codes when exporting to China?

    There are many reasons why HS codes are needed to classify products in a country, including China.

    While you probably think it’s obvious that products need to be classified, here are some more specific reasons why HS codes are needed:

    Control of imports and exports

    HS codes are needed to control the export and import of products. For example, let’s say that the Chinese government wants to protect its local wheat producers from competition overseas, who wish to import wheat into China.

    The Chinese government can then restrict imports, by setting limiting quotas for example, to the specific HS code used for wheat.

    Or, let’s say that an epidemic breaks out, affecting the quality of poultry products. The Chinese government can then prohibit the imports of the poultry, by recognizing the HS code used for that product.

    Normally, CIQ is the authority that handles the control of imports and exports at the harbors and airports.

    hs-codes-duty-rates-china

    Product testing

    HS codes are used to determine what GB standards and product testing that apply to your products.

    So: when your goods arrive at the Chinese harbor, the customs will be able to judge what product testing that you need to comply with, based on the HS codes that apply to your products. They can thereafter request the test reports needed.

    GB standards are used for testing, labelling, packaging and are similar to the ISO standards used in the West. In fact, many GB standards have derived from ISO standards.

    Collect trade data and statistics

    HS codes are also used to collect trade data and statistics.

    This is crucial to understand if a country’s economy is healthy, if there’s any trade surplus or trade deficit. The government can then regulate imports and exports accordingly.

    Determine customs tariffs

    With the correct HS codes, the Chinese customs can also determine what customs tariffs that apply to your products (more about that later in this article).

    Keep in mind that HS codes can be used due to other reasons, not mentioned above.

    When do I need to inform about my HS codes?

    You need to know what HS codes that apply for your products when you register your company at AQSIQ, this is one of the first steps in the exporting process.

    The HS codes need to be included on the customs declaration form as well.

    Without the codes, the customs won’t be able to determine what product testing your products need to comply with and what import duties to use.

    How can I find the HS codes used for my products?

    HS codes can be found and summarized by using online searching tools. The systems are automatized, so it’s important that you double check the HS codes retrieved.

    You can also find the HS codes on government pages, like the China customs official website.

    Don’t forget to confirm with your Chinese importer whether the HS codes are correct, as they are responsible to manage the customs clearance.

    I’m not saying that you should leave all the job for them, as you’re sitting in the same boat. But it’s their obligation, as importers, to help you through the customs clearance.

    Seeking help from a professional third party is also recommended to reduce risks, as they can help you with everything from determining HS codes, customs clearance, labelling, product testing, CIQ declarations, CCC certification and more.

    What happens if I use the wrong HS codes?

    Using the wrong HS codes can delay customs clearance, costing you much money and time.

    You’ll also face risks to either pay too much or too little taxes, the latter one can be treated a serious crime.

    In addition, the customs won’t be able to know what products you intend to import, hence they don’t know what product testing you need to comply with.

    If you accidentally use the wrong HS codes, you should cooperate with your Chinese importer and preferably seek help from a third party to help you out.

    Import duty by HS codes

    The Chinese government has reduced import duties for almost 200 products (including apparel, meat, cosmetic products and more).

    Rates have been lowered with various levels, ranging between 30-100%, which is a great reduction, helping to increase imports and to improve quality of local products.

    You can find the complete list translated into English here. The third column represents the HS codes (税则号列).

    Conclusion

    HS codes are used to classify products traded in a country. The codes aren’t used in China only, but internationally.

    You need to use HS codes for a country to collect trade data, control imports and exports, to determine import duties and more.

    Failing to use the correct HS codes will result in problems at the customs clearance, that can cost much money and time.

    Using the wrong HS codes can also make you pay too much in tax, or too little, which can in the worst case be treated as a serious crime.

    You can find HS codes with search engine tools or by visiting government websites.

    I hope you find this article interesting and recommend you to read the complete article if you want to know more.

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  • 6 Responses to “HS Codes & Import Duty Rates in China: The Ultimate Guide

    1. nicos at 7:26 am

      Hi,

      I want to know, if one equipment relate to multiple item, so can we submit multiple HS code?
      or it must be one HS code only for one equipment? Hope you understand my question. Thank you.

      1. Marcus Sohlberg at 7:29 am

        Hi Nicos,

        Normally you use one HS code for the complete assembly, while each sub-component has its own HS code. What kind of product are you selling?

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