Any goods, imported or acquired in Brazil, must have an NCM code in its legal documentation (invoice, legal books, etc). The objective is to classify the items according to the Mercosur regulations.
NCM stands for "Mercosul Common Nomenclature" and it is an eight-digit code established by the Brazilian Government to identify the nature of goods and promote the development of international trade, in addition to facilitating the collection and analysis of foreign trade statistics.
The NCM was adopted in January 1995, by Argentina, Brazil, Paraguay and Uruguay, and is based on the HS (Harmonized Commodity Description and Coding System). The HS is an international method of classifying goods that contains a structure of codes with the description of specific characteristics of the products, such as, for example, origin of the product, materials that compose it and their application. Of the eight digits that make up the NCM, the first six are HS classifications. The last two digits are part of Mercosur's own specifications.
The Harmonised Commodity Description and Coding System, or simply Harmonised System (HS), is an international method of classifying goods based on a structure of codes and their descriptions. It was created in 1988.
In short, the HS - Harmonized System consists of:
This System was created to promote the development of international trade, as well as to improve the collection, comparison and analysis of statistics, particularly those of foreign trade. In addition, the HS facilitates international trade negotiations, the elaboration of freight tariffs and statistics on the different means of transport of goods and other information used by the various players in international trade.
The composition of the HS codes, formed by six digits, allows the specificities of the products, such as origin, constituent material and application, to be met in a logical numerical order, increasing and according to the level of sophistication of the goods.
For better understanding, follow an example of NCM application. Example:
This code refers to the following criteria for defining the code:
The system uses all Standard Product Taxation directly linked to the NCM Code. This means that all products that have the same NCM also have the same Standard Taxation.
In case of doubts about the classification of goods, it is necessary to consult the fiscal classification of goods disclosed by RFB - Federal Revenue of Brazil.
To learn more, consult a company with more than 80 years in the foreign trade consulting market.
Do you have any other questions? Leave us the comments!