Page 189 - DCOM308_DCOM502_INDIRECT_TAX_LAWS

Indirect Tax Laws

Notes complex commercial program the U.S. Customs Service administers because it involves every
facet of Customs business, including both exports and imports.
There are several kinds of drawbacks, the main ones being:

Unused Merchandise

Imported merchandise is unused and exported or destroyed under Customs supervision. 99
percent of the duties, taxes or fees paid on the merchandise may be recovered as drawback.

Substitution Unused Merchandise

Merchandise that is commercially interchangeable with imported merchandise upon which
duties and taxes were paid and that has not been used, is exported or destroyed under Customs
supervision. 99 percent of the duties, taxes or fees paid on the merchandise may be recovered as
drawback.

Rejected Merchandise

Merchandise is exported or destroyed because it does not conform with samples or specifications,
or has been shipped without the consent of the consignee, or has been determined to be defective
as of the time of importation. 99 percent of the duties which were paid on the merchandise may
be recovered as drawback.

Direct Identification Manufacturing

If articles manufactured in the United States with the use of imported merchandise are subsequently
exported or destroyed then drawback not exceeding 99 percent of the duties paid on the imported
merchandise may be recoverable.

Substitution Manufacturing

Both imported merchandise and any other merchandise of the same kind and quality are used to
manufacture articles, some of which are exported or destroyed before use, then drawback not
exceeding 99 percent of the duty which was paid on the imported merchandise may be payable
on the exported/destroyed articles.

11.8 How to Obtain Drawback

 The guidelines for completing a drawback claim are provided in the Customs Regulations,
more specifically 19 CFR 191 Subpart E. We can help you with the application process,
prepare inventory record and file the claim.
 The locations for filing a drawback claim are Boston, Chicago, Houston, Los Angeles,
Miami, New Orleans, Newark, and San Francisco.

 A drawback entry and all documents necessary to complete a claim generally must be
filed within three years after exportation or destruction of the articles.

Export Procedure

Duty Drawback – for Past Exports. Waiver form requirement of prior notice of intent to export
must be supported by a direct inventory identification method.

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