Duty Drawback
Also known as: Drawback, Customs Refund, Duty Refund
Definition
Duty drawback allows importers to recover up to 99% of duties paid on goods that are later exported. It’s an underutilized program—billions in potential refunds go unclaimed annually.
Types of Drawback
| Type | Description |
|---|---|
| Direct identification | Same goods imported and exported |
| Substitution | Commercially interchangeable goods |
| Manufacturing | Imported goods used in exported products |
| Rejected merchandise | Defective imports returned |
| Unused merchandise | Imported but never used domestically |
Drawback Eligibility
To qualify:
- Duties must have been paid
- Goods exported within 5 years of import
- Claim filed within 5 years of export
- Proper documentation maintained
Refund Amount
- 99% of duties paid (1% retained by government)
- Includes merchandise processing fees
- May include harbor maintenance fees
Claiming Drawback
- File drawback entry with CBP
- Provide import documentation
- Show export proof
- Link import to export
- Wait for CBP processing (3-12 months)
Who Benefits Most
- Manufacturers using imported components
- Distributors exporting portions of imports
- Companies with returned merchandise
- Re-exporters
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