Obtain HTS Tax Codes for Each Product

Retail Order Management includes a robust and comprehensive tax and duty calculation engine. When products are placed in a consumer’s cart on a client webstore, the webstore can call the ROM tax API and obtain tax and duty information for each product based on the consumer’s delivery location.

Some setup is required for accurate tax calculation. Each product offered for sale must be rated in advance with an HTS tax code. You must then include each product's HTS code in the tax calculation service call and order service call so that taxes and duties can be calculated correctly for the order.

Each individual product is rated into an appropriate class to determine by country or region the appropriate tax or duty tariff to apply. Different areas have different tax rates and rules based on a variety of factors. For example, in some areas clothing is not taxable while electronics are.

As part of Radial’s fulfillment and full-service, a team of professionals classify a client’s products in order to assign the appropriate tax codes. For Retail Order Management client webstores, these codes are then delivered to the client by a file feed. When the tax service and order services are called from the webstore, the tax code is sent along with each product requiring tax calculation.

Determining the tax code in advance, and sending it with the service call, speeds up order processing. It would take longer to process each order if the product-to-tax-code lookup occurred dynamically at the time of the order.

Tax Code Process

ROM partner submits unrated products to Product Hub via item master.
Product Hub uses Item Master Queue to submit/load this data to Data Warehouse
ISHIP team extracts unrated products report from Data Warehouse
ISHIP team does manual duties rating process. Note that this is partly a human process and can take a period of time that depends on the number of products and the response from rating partners. Radial suggests unrated items are sent 2-3 weeks prior to needed go-live date.
ISHIP team submits rated data to Product Hub
Product Hub transforms data and send it out to Tax/Duties/Fees (TDF) hub and Order Management System (OMS)
TDF consumes data and generates exception data report (if applicable) and re-submits file to Product Hub, which is routed back to ISHIP for any needed corrections
OMS and TDF reconsumes corrected data
Product Hub will be also sending the rated product data back to ROM partner as part of the ISHIP feed.
Rating information is processed from the Product Hub and stored in the Data Warehouse so that when ISHIP team pulls a supplemental future unrated item report, these products are not exported.
Merchant Webstore needs to consume data and will use the same to get the duties from TDF service call when submitting calls for tax calculation.

Information Needed for Tax Coding

In order for products to be rated for international duties, fees and applicable taxes, specific information is needed to accurately determine the Harmonized Tariff Rates and destination country restrictions. When providing Radial with an item master some products have a varying degree of information required.

A catalog health check can be provided by the iShip team to review the information provided by the item master to determine international rating eligibility.

The below chart shows what information types are required for tax coding of each product. For some products, additional information might be requested to provide the most accurate product rating.

Product	Product Type	Gender	Knit/Woven	Product Material	Country of Origin	Price (EA)
Toys	X				X
Clothing	X	X	X	X	X
Shoes	X	X		X	X
Sports Equipment	X				X
Sports Memorabilia	X				X
Furniture	X			X	X
Jewelry	X			X	X	X
Food Products	X			X	X
Electronics	X				X	X
Any Other	X			X	X	X

The following definitions apply to the table of tax coding information:

Product Type: Is the common name of product readily available or shown in the item master? i.e. helmet, tricycle, action figure, doll, baby one piece, hat, scarf, key chain, wallet, purse, back pack, etc.
Gender: Women, Men, Boys, Girls, Baby and mostly applies to Apparel. Information is determined from product type, long description or short description in the item master.
Knit/Woven: Mostly applies to Apparel and Textiles and can include Knit, Woven, Crochet, Mesh, and Non-woven. Information is determined from product type, long description or short description in the item master.
Product Material: The material for apparel and textile is the fiber content of the garment or textile and type of fabric (for example 25% Cotton, 75% Polyester and Shoes MUST equal 100%). Information is determined from long description, short description or Attribute Text in the item master. Hard good material is the majority composition such as wood or plastic.
Country of Origin: Actual country where major portion of product was assembled and/or manufactured. This information must be present in Radial systems or goods will not ship or pass an international customs office.