Definition
Duty drawback is a CBP refund program that returns up to 99% of duties, taxes, and fees paid on imported merchandise that is subsequently exported from the United States or destroyed under CBP supervision. The program is authorized under 19 USC 1313 and allows importers to file claims for refunds up to 5 years after the original import date.
Why It Matters for Importers
If you import goods and then export any portion — whether as finished products, components, or unused merchandise — you may be leaving significant money on the table by not filing drawback claims. With current tariff rates on many products exceeding 25%, the refund amounts can be substantial.
Many importers are unaware they qualify for drawback, or assume the process is too complex to pursue. In reality, a well-structured drawback program can recover hundreds of thousands of dollars annually for mid-size importers, and the 5-year lookback period means you can claim refunds on duties already paid.
Key Details
- Refund amount: Up to 99% of duties, taxes, and fees paid on the original import.
- Types of drawback: Manufacturing drawback (imported materials used in U.S. manufacturing then exported), unused merchandise drawback (imported goods exported in same condition), and substitution drawback (commercially interchangeable goods).
- 5-year window: Drawback claims can be filed up to 5 years from the date of import. Exports must occur within 5 years of import.
- Documentation: Requires matching import entries to export documentation. Good record-keeping is essential.
Drawback is one of the most underutilized duty savings programs available. Read our guide to duty drawback.
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