The taxes and duties that you pay depend on the HSN code of the product. First and foremost, let’s understand what an HSN code is? It is a classification system for commodities used worldwide to bring a standardization for customs and other duties. An HSN code comprises of a category code, that decides which product/commodity falls under which category and the respective duties applicable.
Many times, importers misclassify products conducting a fraud to save certain taxes and duties. What most customers don’t know is that misclassification of the HSN code is a punishable offense and can bear a great impact on them.