It seems like such a simple question, but oftentimes a professional
in international trade can’t tell you the difference, heck even I had to look it up.
directly relates to the harmonized tariff system codes (HTS) which imported/exported products are classified under. HTS codes let U.S. Customs know what tariff rate should be charged to specific products; this mainly applies to imports over exports.
Let’s say I’m an importer of “knotted carpets and textile floor coverings.” I classify my product under the HTS code 5701.10.9000
, and the corresponding U.S. tariff would be the taxed percentage, which in this case is 4.5%.
is the actual amount of money paid on the imported/exported product. Although, the actual tax reference is the same thing, the import duty paid on “knotted carpets and textile floor coverings” depends on the quantity imported.
For example, if I imported $200,000 worth of the product to the United States last month, my duties would then be $9,000.
Most professionals use the terms interchangeably, which is correct, but in certain cases one is more appropriate than the other.
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