Duty Drawbacks

Everyone knows that when a business is importing a product into the United States they will be required to pay duty. Duty is a percentage of the total cost of goods that will be imported. Some companies will then export this same product to another country and pay duty for that country as well. In order to recover the duty for importing, they will need to apply for a refund from US Customs for that duty paid. This refund is called a duty drawback.

Duty drawbacks can save companies thousands of dollars and allow them to be more competitive in the international market. In order to get the refund though they need to apply and have all criteria set up for approval by customs. This means the cargo must fall into one of the categories for drawback and they must file individually by process in order to get the refund. If the goods are similar and not modified much from the original import, you may be eligible for accelerated payments and be able to re-export the goods before submitting drawback information. Some customs brokers will set you up with a program with customs if you are planning regular shipments that will require duty drawbacks.

Paying duty for importing cargo is usually combined with landed costs or total freight costs which can then set retail prices higher if these drawbacks are not in place. If you are planning to re-export goods, it will only benefit you to work with your freight forwarders and customs brokers to set up the shipment properly for duty drawbacks.