Duty codes determine rates for products which are imported and later exported or for products which are exported and later returned to you. For example, your company is in Canada. You order 100 products from a company in the United States. They ship 50 from a warehouse in the United States and 50 from a warehouse is Japan. Products from the United States have different duty codes and charges than the 50 products received from Japan. You must compensate for this difference.
Duty codes are assigned either at the product level or the buy line level. However, purchase orders with items containing duty harmonizing codes bypass the normal freight calculation. Freight is calculated based on duty harmonizing codes for all items on the purchase order.
When a purchase order is created with more than one product on it, one of which has a duty code assigned, the Customs Drawback Information screen displays when you navigate to that product. In addition, if you use the Duty hot key, the system populates the Customs Drawback Information screen with the duty data found in the product file and in Duty Harmonizing Code Maintenance.
Note: The Country of Manufacture is not a validated field because the country information in Duty Harmonizing Code Maintenance is user-defined and case sensitive. Therefore, if you enter England in the code maintenance, you must enter England to retrieve that code in Customs Drawback and not england.
Every purchase order receipt that has products with duty codes assigned to them requires a series of entries for each product. These entries include certificate of entry, tariff codes, port of entry, lot, duty paid, certificate of origin document and country of manufacture. If you assign a harmonizing code, then the country of manufacture is required. These details then translate to what you need to remit to the government for duty taxes owed. The system calculates the duty cost and adds this amount to the landed cost.
Note: Freight overrides at the generation level always take precedence over what is set up at the duty harmonizing code level.