10.33 As mentioned in Chapter 4, see Commodity Classifications, the Harmonized System (HS) provides the basis for the description and classification of goods for Customs purposes in Australia and many other countries. As a signatory to the HS Convention, Australia is required to collect and publish statistics classified to the HS. Australia is one of 151 signatory countries, with the HS used by more than 170 countries as a basis for their Customs tariffs and for the collection of international merchandise trade statistics. Over 98 per cent of world trade is classified in terms of the HS.
10.34 As the international six-digit HS classification is reviewed periodically, these reviews have consequential impacts on the eight-digit import tariff items, and on the eight-digit export and ten-digit import statistical codes used in Australia. In early 2000, the World Customs Organization (WCO) finalised changes to the six-digit HS classification, which are to be implemented by Australia on 1 January 2002.
10.35 In the period leading up to this date, Customs and the ABS will review the existing tariff and statistical codes affected by the six-digit HS level changes. While the review will focus on those items identified as requiring change due to HS 2002, the opportunity may be taken to make other changes to simplify and improve usage of the classifications.
10.36 The ABS is conscious of the competing interests in keeping the classification comprehensive, detailed and relevant for users of trade statistics, while at the same time ensuring that exporters and importers (and their agents) are able to report accurately against the classification and not incur excessive reporting burden. In determining the effects on existing categories in the detailed classifications, factors that will be considered include user requirements, the significance of trade, the complexity of descriptions, any reporting difficulties, and any existing or anticipated confidentiality limitations.
10.37 Extensive consultation will be undertaken with government departments and agencies, exporters and importers (and their agents), and current users of trade statistics throughout the HS 2002 Review. In the most recent HS Review completed in January 1996, but implemented by Australia from July 1996, approximately 500 (or 10 per cent) of the six-digit HS items were changed. The HS 2002 Review is not expected to impact on as many six-digit HS items.