Transcript 6 - importance of knowing the right tariff code of your product

THE IMPORTANCE OF
KNOWING THE CORRECT
TARIFF CLASSIFICATION
OF PRODUCTS
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Understanding Tariff Classification
• All traded goods that enter a country must be
categorized according to the Harmonized
System
• The act of placing goods in the correct
category is called classification.
• Classification determines how much duty will
be collected.
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Harmonized System
• an international multipurpose product
nomenclature developed by the
World Customs Organization (WCO)
 To achieve international uniformity in
the classification of goods
 To provide an updated nomenclature to
take account of technological
developments and changes in
international trade patterns
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Harmonized System
Section II Vegetable Products
Chapter 8 Edible fruits and nuts; peel of citrus fruit
or melons
Heading 08.03 Bananas, including plantains, fresh
or dried
0803.10 - Plantains
0801.90 - Other
4
ASEAN Harmonized Tariff
Nomenclature
• An 8-digit commodity nomenclature based
on the HS
• It involves an alignment of national tariff
requirements of each ASEAN member
country
• Started in 2004
• The NEDA Board approved the adoption of
AHTN 2012 on 18 Sept 2012
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ASEAN Harmonized Tariff
Nomenclature
Section II Vegetable Products
Chapter 8 Edible fruits and nuts; peel of citrus fruit
or melons
Heading 08.03 Bananas, including plantains, fresh
or dried
0803.10.00 - Plantains
0801.90.00 - Other
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Tariff and Customs Code of the
Philippines
• The HS- and AHTN-based Philippine tariff
nomenclature which determines the tariff
classification and the corresponding rates of
duty is contained under Sec 104 of the TCCP.
• The TCCP is being administered and
maintained by the Tariff Commission under
Executive Order No. 688 which empowers
the Tariff Commission to amend the
nomenclature but not the tariff rates.
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Rate of Duty (%)
MFN
Hdg.
No.
AHTN Code
2012
(1)
84.01
(2)
DESCRIPTION
(3)
Nuclear reactors; fuel elements
(cartridges), non-irradiated, for
nuclear reactors; machinery and
apparatus for isotopic separation.
ASEAN
Member
States
Enjoying
Concession
20122013
20142015
ATIGA
(4)
(5)
(6)
(7)
8401.10.00
- Nuclear reactors
3
3
0
Except LA.
8401.20.00
- Machinery and apparatus for
isotopic separation, and parts
thereof
- Fuel elements (cartridges), nonirradiated
- Parts of nuclear reactors
3
3
0
Except LA.
3
3
0
Except LA.
3
3
0
Except LA.
8401.30.00
8401.40.00
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FREE TRADE AGREEMENT
• a legally binding agreement between
2 or more countries to reduce or
eliminate barriers to trade, and facilitate
the cross border movement of goods,
services and investments between the
territories of the Parties
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Benefit of FTAs to businesses
Trade in Goods (TIG): Tariff concessions for
eligible exports
• FTAs do not award tariff benefits to all goods.
• To qualify for preferential tariffs, goods must
be (Philippine) originating.
Rules of Origin
An objective set of criteria set up to determine a
product’s originating status.
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Top traded products between Japan and Philippines
AHTN 2012
0803.90.00
(PH rate:
MFN – 15%
PJEPA – 0
AJCEPA – 8)
DESCRIPTION
Bananas,
fresh or
dried
FTA
MFN RATE, %
FTA RATE, %
PSR
Japan
20 / 25 / 3
AJCEPA
15.5 / 22.7 /
0
CC
PJEPA
5.5 /9.1 /
10.9/19.1 /
0
CC
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Top traded products between Japan and Philippines
AHTN 2012
4418.10.00
(PH rate:
MFN – 5%
PJEPA – 0
AJCEPA – 0)
DESCRIPTION
Windows,
Frenchwindows
and their
frames
FTA
Japan
AJCEPA
PJEPA
MFN RATE,
%
FTA RATE,
%
PSR
0
0
CTH
CTH
0
12
Top traded products between Japan and Philippines
AHTN 2012
4418.90.10
(PH rate:
MFN – 5%
PJEPA – 0
AJCEPA – 0)
DESCRIPTION
Cellular
wood
panels
FTA
Japan
AJCEPA
PJEPA
MFN RATE,
%
FTA RATE,
%
PSR
0
0
CTH
CTH
5
13
Top traded products between Japan and Philippines
AHTN 2012
8544.30.12
8544.30.13
8544.30.14
8544.30.19
(PH rate:
MFN – 15/30
PJEPA – 8/S
AJCEPA –
8/15/30)
DESCRIPTION
Wiring
harnesses
for motor
vehicles
FTA
Japan
AJCEPA
PJEPA
MFN RATE,
%
FTA RATE,
%
PSR
0
RVC (40) or
CTH
RVC (40) or
CTH
0
0
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How can you avail of these incentives?
1. Know the correct AHTN heading of your product.
2. Verify if the product is offered under FTAs.
3. Compare the tariff rates under MFN and FTA.
4. Check the “Product Specific Rules or PSR”.
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TARIFF CLASSIFICATION RULINGS
 Section 1313a of the Tariff and Customs Code
 TC Form 1 (Imports)
 TC Form 2 (Exports)
 Forms downloadable at TC Website
 Submit accomplished form, together with
samples, technical brochures (description,
function, composition, etc.)
 Filing Fee (P300.00 per article)
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Accomplished TC Form 1
Advance Ruling issued
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TARIFF COMMISSION
5th Floor Philippine Heart Center,
East Avenue, Diliman, Quezon City
Tel. (+632) 926-8731
Fax (+632) 921-7960
Website: www.tariffcommission.gov.ph
Email/s: [email protected]
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Thank you!!
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