The Harmonized System Nomenclature (HSN) Code is an internationally standardized system developed by the World Customs Organization (WCO) for the classification of goods. The primary objective of the HSN Code is to facilitate the smooth and uniform classification of products across countries, which helps in ensuring consistent and transparent trade practices globally.
Purpose and Importance of HSN Code
The HSN Code plays a pivotal role in international trade by providing a systematic and logical framework for classifying goods. This system helps in identifying products easily and applying the correct duties and taxes. The HSN Code also aids in the collection of international trade statistics and ensures compliance with global trade regulations. In domestic contexts, particularly under the Goods and Services Tax (GST) regime in India, the HSN Code helps in the standardized classification of goods for taxation purposes, thus simplifying tax compliance for businesses.