DUTY DRAWBACK 101
What Is Duty Drawback?
Originally enacted in 1789 as part of the Original Tariff Act, the drawback law allows for the refund of duties, taxes, and fees on imported merchandise that is subsequently exported.
For example: A company imports sunglasses from its factories in China into its US North America distribution facility and pays a 2.1% duty on the imported value. 70% of the frames are sold at its domestic retail stores, while 30% of the sunglass frames are exported to stores in Canada and the Caribbean. The Company is eligible for a refund of the 2.1% it paid in duty when the imported frames are exported to Canada and the Caribbean.
Drawback legal provisions found in United States Code Section 1313:
Methods of matching imports and exports (applies to both manufacturing and unused merchandise drawback):