Duty Drawback

What Is Duty Drawback?

Duty drawback is a refund of import duties, taxes, and fees that were paid on goods that are subsequently exported, destroyed, or used to manufacture a product that is exported.

How Does Duty Drawback Work?

An importer pays duties on goods entering the country, then, if those same (or manufactured) goods are later exported rather than sold domestically, they can file a claim with customs authorities to recover a portion (often up to 99%) of the duties originally paid. This requires careful record-keeping linking the imported goods to their eventual export.

Why Duty Drawback Matters

Duty drawback can represent a significant, often underused, cost recovery opportunity for companies that import materials, and re-export finished goods or excess inventory, many eligible companies don't claim it simply because tracking the required documentation is administratively demanding. For high-volume importers/exporters, setting up a systematic drawback claims process can meaningfully improve margins.