HS code and ITC(HS) code: how to classify your product

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What HS and 8-digit ITC(HS) codes are, how to find the right one, how Schedule 1 and 2 policy work, and the cost of getting it wrong.

Short answer: an HS code is the international number used to classify a product in trade. The World Customs Organization's Harmonized System uses 6 digits. India adds two more digits to make an 8-digit ITC(HS) code, which you put on shipping bills and bills of entry. The same code decides your customs duty, whether your product is free, restricted or prohibited for import or export, which incentives apply, and whether you get a lower duty under a trade agreement. Getting it right is one of the first jobs in any export or import business.

This guide explains how the codes are built, how to find the right one, and what happens if you get it wrong.

What is the Harmonized System?

According to the World Customs Organization (WCO), the Harmonized Commodity Description and Coding System (HS) is a multipurpose international product nomenclature. It has more than 5,000 commodity groups, each with a six-digit code, arranged in a legal and logical structure with rules for uniform classification. The WCO says more than 200 countries and economies use it as the basis for their customs tariffs and trade statistics, and that it covers over 98% of merchandise in international trade.

The WCO's Harmonized System Committee updates the HS every 5–6 years to reflect new technology and changing trade. Codes for some products change with each edition, so always check you are using the current one.

How an HS code is structured

Digits	Level	Example of what it identifies
2	Chapter	A broad group, such as a chapter for a type of material or product
4	Heading	A product family within the chapter
6	Sub-heading	A specific product, common to all HS countries
8	Indian tariff item (ITC(HS))	India's national split for duty and policy

The first six digits are the same in India and in your buyer's country. The digits after that are national: India uses 8, and many other countries use 8 to 10. When your buyer quotes a 10-digit code from their tariff, match the first six digits with yours. Then check India's 8-digit lines under that sub-heading.

What is ITC(HS)?

The Foreign Trade Policy (FTP) 2023, para 2.02, describes the Indian Trade Classification (Harmonised System), or ITC(HS), as a compilation of codes for all goods for export and import. Goods are classified at 2, 4, 6 and 8 digits. ITC(HS) is aligned with the WCO system at 6 digits, and India keeps its national 8-digit codes in the First Schedule of the Customs Tariff Act, 1975.

ITC(HS) has two policy schedules:

• Schedule 1: Import Policy. Shows whether each item is free, restricted, prohibited, or importable only through State Trading Enterprises, along with any conditions. It applies to new goods. Second-hand goods are covered by FTP para 2.31.
• Schedule 2: Export Policy. Shows the export policy for items that are regulated. FTP para 2.40 says all goods may be exported freely except where ITC(HS), the FTP or another law regulates them.

You can search both on DGFT's ITC(HS) page.

Why the right code matters

• Customs duty: the import duty rate is set against the 8-digit tariff item. Our guide on how to import goods into India shows where the code fits in the clearance process.
• Import and export policy: one code may be free while a neighbouring one is restricted.
• Export incentives: rates under schemes such as duty drawback and RoDTEP are listed against product codes in their own schedules, so the wrong code can mean the wrong rate.
• Trade agreements: preferential duty rates and product-specific rules of origin are listed by HS code. For example, the India–New Zealand FTA's origin rules apply at the 6-digit level. See our India–New Zealand FTA guide.
• Trade statistics and market research: official data such as TradeStat is organised by HS code, so a wrong code gives you wrong market data.
• GST: GST rates and invoices also use HSN codes, which are based on the same system.

How to find the right HS code: step by step

1. Describe the product precisely. Include what it is made of, what it does, how it is processed and how it is packed. Classification depends on these facts, not on a trade name.
2. Find the chapter. Use the section and chapter titles of the tariff, and read the chapter notes. They often include or exclude products explicitly.
3. Narrow to the heading and sub-heading (4 and 6 digits). Read the heading texts, not just the short descriptions in a search tool.
4. Apply the General Rules of Interpretation. These international rules decide close cases, such as mixtures, sets, parts, and unfinished goods.
5. Choose the 8-digit ITC(HS) line that fits your product.
6. Check the policy in Schedule 1 (imports) or Schedule 2 (exports) on DGFT's ITC(HS) page.
7. Cross-check with past shipping bills or bills of entry for the same product, your customs broker, and your buyer's classification at 6 digits.
8. Record your reasoning in a short note. If Customs questions the code later, this helps.

When classification is genuinely unclear

Some products sit between headings, for example multi-function devices, sets of mixed items, or new technology. Options include:

• Asking your customs broker or a customs consultant for a written opinion.
• Checking the WCO's Explanatory Notes and classification opinions, available by subscription through WCO Trade Tools.
• Asking your customs broker or consultant whether an advance ruling on classification under the Customs Act makes sense for a large or regular import, and how to apply under the current rules.

What happens if you use the wrong code

• Short-paid duty can be demanded later with interest, and penalties may apply.
• Restricted goods can be held at the port if the correct code shows that a licence was needed.
• Incentives such as drawback or RoDTEP can be denied or recovered.
• FTA benefits can be refused if the origin rule you followed was for a different code.

Classification mistakes are usually honest, but Customs looks at the result, not the intention. Taking an hour to classify properly is cheap insurance.

Practical tips

• Keep a product master: each SKU with its 8-digit code, description, GST rate and policy notes.
• Re-check codes when the HS edition or the Customs Tariff changes, usually at Budget time and when a new HS edition comes in.
• Use the same description on your invoice, packing list and shipping bill.
• Don't copy a competitor's code without checking that your product really is the same.

Our guide The Documentation Decoder explains where the code appears on each export document.

Frequently asked questions

What is the difference between an HS code and an ITC(HS) code?

The HS code is the international 6-digit code maintained by the World Customs Organization. ITC(HS) is India's 8-digit classification, which matches the HS at 6 digits and adds two national digits used for Indian duty and trade policy.

How many digits does India's HS code have?

Eight. India's national tariff items are at the 8-digit level, notified under the First Schedule of the Customs Tariff Act, 1975, and used in ITC(HS).

Where can I check whether my product is restricted?

On DGFT's ITC(HS) page. Schedule 1 shows the import policy and Schedule 2 shows the export policy for each code, with any conditions.

Is the HSN code under GST the same as the HS code?

Both are based on the same Harmonized System, so the first digits line up. But GST rate schedules and customs tariff lines are separate legal lists. Check each for its own purpose.

What if my buyer uses a different code?

Countries share the first six digits, and the digits after that are national. Compare the first six digits. If those differ, talk to your buyer, because one of you may have the classification wrong.

Educational information only, not legal or tax advice. Classification depends on the exact product. Confirm your code with the current Customs Tariff and ITC(HS), or ask a licensed customs broker.

Exporting and looking for importers who buy your HS code? Our buyer-leads service can help. Or get one short trade update a week: join The India Trade Brief newsletter, or use the sign-up box below.

Educational information only, not legal, tax or financial advice. Always verify current rules on DGFT, ICEGATE and RBI portals before acting.