Charter is the leading provider of duty and tax drawback services in the United States. Charter files claims for more duty and tax recoveries than all other U.S. service providers combined. Our legal experience, planning skills, high-level expertise and in-depth experience are simply unmatched by any other service provider. Our services include all matters necessary to establish and run a sophisticated drawback program that will maximize recoveries, including business review and identification of opportunities, planning and optimization, documentation, claim filing and audit support.
Drawback is an important tool available to importers, exporters and others to eliminate or mitigate the costs of duties and excise taxes imposed on imported merchandise. It is the oldest export promotion program in the United States. Set forth below are brief summaries of the various types of duty and tax drawback related to petroleum products, petrochemicals, chemicals and plastics.
Petroleum, Petrochemicals, Chemicals and Plastics – The provision of the drawback statute that is most significant to Charter and its clients is subsection (p), the so-called petroleum derivatives drawback section (see 19 U.S.C. 1313(p)). Subsection (p) permits the recovery of customs duties (and, in certain cases, taxes and fees) paid on importation of specific eight digit classifications when matched against exports within the same eight digit classification that occur within a 180-day import-to-export time period. The provision of law also allows for unlimited substitutions. The specific eight digit classifications contained in 1313(p) cover many of the petroleum, petrochemical, chemical and plastics products.
Unused (Non-Manufacturing) Drawback – This provision of the drawback statute (19 U.S.C. § 1313(j)) allows for a refund of duties, taxes and fees on imported merchandise exported in essentially the same condition. Imports can be matched to exports by direct identification or by substitution (i.e. the export is “commercially interchangeable” with the import). This type of drawback can apply to all types of imports, and the export must occur after the import and within three years.
Manufacturing Drawback – These provisions of the drawback statue (19 U.S.C. § 1313(a) and (b)) allow for a refund of duties (no taxes and fees) paid on imported merchandise based upon the production and export of articles from imported, duty-paid input or similar (“same kind and quality”) domestic input, which is substituted for the imported input. This type of drawback can apply to a variety of manufacturing operations and various time limits apply.
Drawback is a complex area that contains a vast array of rules, regulations and limitations. As the nation’s leading drawback service provider, Charter assists clients in maximizing their drawback in a compliant and efficient manner.