Duty Drawback

Duty drawback is a provision in customs law — available in the United States under 19 U.S.C. § 1313 and in many other jurisdictions — that permits importers to recover duties, taxes, and fees paid on imported merchandise that is later exported. For ecommerce merchants with international sales, duty drawback represents a significant cost recovery opportunity that is frequently overlooked. If a merchant imports goods from Asia, pays 25% in tariffs, and then sells 15% of that inventory to customers in Canada or Europe, they can file drawback claims to recover up to 99% of the duties paid on the exported portion. The process requires meticulous documentation — matching import entries to export shipments — and typically involves a three-year filing window. Given the elevated tariff environment of 2025–2026, duty drawback has become an increasingly valuable lever for merchants to recapture margin on cross-border sales that would otherwise bear the full burden of import duties.