Top 5 Mistakes Importers Make When Classifying Their Products

If you’ve ever scrolled through the Harmonized Tariff Schedule with a mild sense of dread and a strong cup of coffee, you’re not alone. Product classification is where many importers go off the rails. Rookies and veterans alike find themselves in deep trouble when mistakes occur. 

The stakes are high: misclassification can lead to tariff overpayments, costly penalties, and, in some cases, a full-blown CBP audit. If that sounds like fun, read no further. Otherwise, let’s look at the top five classification mistakes importers make and how to avoid them.

1. Trusting Your Supplier’s HTS Code Without Verifying It

We get it. It’s tempting to plug in the HTS code your overseas supplier scribbled into the invoice and call it a day. But here’s the reality: foreign suppliers aren’t responsible for your compliance in the U.S. You, the seller, are responsible.

Many suppliers provide HTS codes based on their own country’s tariff systems or what worked in another market. That might get your shipment on the water, but it won’t help when CBP decides to take a closer look.

2. Using Keyword Searches Like Its Google

The HTSUS isn’t written for convenience. It’s written for consultants, lawyers, and other experts. Search bars can be helpful starting points, but too many importers stop there. Clicking the first match from a keyword search and calling it a day ignores the actual legal framework behind tariff classification.  Try searching for “pencil” or “bucket.”  Report back to us how that went.

The General Rules of Interpretation (GRIs), Section Notes, and Chapter Notes exist for a reason. If you’re not using them, you’re not classifying. You’re taking a wild guess at what applies.

3. Misunderstanding Essential Character for Mixed Goods

Composite goods, kits, and sets are classification minefields. One common mistake? Picking the HTS code that matches the most expensive or flashy component instead of determining what gives the item its essential character.

Under GRI 3(b), CBP expects you to classify the item based on what it functionally is, not what it happens to include.

For example, a wine gift basket with a corkscrew, two glasses, and a bottle opener isn’t a kitchen tool set. It’s a wine gift basket. Big difference. And if you get it wrong, CBP may kindly correct you. With interest.

4. Ignoring New CBP Rulings and Classification Changes

HTS codes don’t live in a vacuum. CBP regularly issues binding rulings, revocations, and reclassifications that reshape how goods are treated at the port. If you’re still relying on a 2017 CROSS ruling and haven’t checked whether it’s been revoked or modified, you may be setting yourself up for surprise duties or worse.

CBP doesn’t take “I didn’t know” as a valid excuse. And neither will your finance department when the retroactive duties hit.

5. Overlooking the Strategic Side of Classification

Classification isn’t just a bureaucratic hurdle. It’s also a strategic tool. The HTS code you choose can affect country of origin determinations, preferential duty programs, and tariff engineering strategies.

A misstep here could cost you thousands in avoidable duties. Importers who understand the intersection of classification and origin are better positioned to take advantage of free trade agreements, minimize exposure, and manage risk.

Classify Like It Matters

There’s no autopilot when it comes to classification. Whether you’re new to importing or double-checking long-held codes, the key is this: be systematic, be current, and don’t go it alone.

At O’Meara & Associates, we help importers navigate the nuances of classification, rulings, and compliance strategy with a focus on long-term risk mitigation. Because in this business, peace of mind is a competitive advantage that pays off in the long run.

 Need help making sense of your classification? Contact O’Meara & Associates today so we can set you on a path that avoids mistakes and an unfriendly visit from the CBP.