Duty drawbacks are monetary refunds on goods that are imported into the U.S. via Customs. Should these goods be exported or destroyed under U.S. Customs and Border Protection supervision within three years of entering the country, the following parties are eligible for duty drawbacks:
- Manufacturers
- Importers
- Exporters
These drawbacks have been a part of international trade policy in the United States since the country was founded and are intended to remove and recover the costs of taxes, fees, and duties on goods sold in international markets. They are codified at 19 U.S.C § 1313 and administered by U.S. Customs and Border Protection.
Duty Drawbacks and Yachts
Drawback statute (19 U.S.C. § 1313(j)), also known as the Unused (Non-Manufacturing) Drawback, permits the refund of taxes, fees, and duties on imported merchandise that is exported in essentially the same condition within three years. The import and ensuing export can be matched by direct identification or by a substitution that is practically interchangeable with the original import.
If you import a yacht valued at $5,000,000 into the United States, a duty of 1.5%, or $75,000, will generally apply. Should you end up not using the vessel and decide to sell to an overseas buyer within three years, you are entitled to claim a drawback totalling 99% of the duty you originally paid, which in this case would amount to $74,250.
Applying for yacht duty drawbacks can be very difficult, as there are certain precise requirements that must be met and a lot of paperwork that you have to fill out. For assistance in claiming a drawback, contact Howard S. Reeder, Inc. today. We will answer any questions you may have and ensure that the exportation concludes with the drawback you are entitled to.
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