Abady Law Firm, P.C. – Customs and Import/Export Attorney Blog

Learn the Basics of Customs and International Trade Policy and Procedure

Archive for January, 2013

Can I get a refund for state sales tax paid while on my trip to the United States?

How to obtain a refund of sales tax paid while visiting the United States

In general, states within the United States provide an exemption from sales and use tax on tangible personal property purchased in that particular state and thereafter exported to another country.  This is would be beneficial for those who travel to the United States from foreign countries and hand carry their goods; however, only Louisiana and Texas currently offers refund of sales tax in such cases.

Other than hand carry, the process for applying for a sales tax refund may be different, depending on the state you have purchased the goods from.  In certain situations it may make economic sense (i.e. shipping fees and import duties at the country of destination) to make large purchases in the United States and have them shipped by carrier to your foreign address.

For example:  Mr. Doe buys $100,000.00 worth of products in New York and pays 8.875% in sales tax equalling $8,875.00, Shipping those goods to and paying import duties (as opposed to hand carry in luggage) in Hong Kong is only $2,500.00.  As long as Mr. Doe keeps all his receipts and shows proof of export for said products Mr. Doe would get back $6,375.00 from the New York State Tax Department.  Thus, instead of paying $108,875.00 (cost of products including tax) he would only end up paying $102,500.00 for those products.

*It may also make sense if you are traveling with a group of people to consolidate a shipment all together to a foreign destination in order to benefit from a sales tax refund.

To get the sales tax refunded one must keep all shipping documentation as evidence that the goods left the United States. Shipping documentation may include a U.S. Postal Service, UPS, FedEx receipt, or a freight forwarder’s receipt and a copy of the original bill of lading issued by a licensed carrier describing the goods to which a refund will be requested.

Keep in mind that the requirements are comprehensive and there may be a limited period of time to which one may be permitted to request a sales tax refund.  Further, the wait time for the refund can take months.  Thus, it may be beneficial to contact an attorney who has experience in this area.

Contact us today for legal assistance is preparing an application for the return of sales tax paid on exported goods.

Customs Attorney: Liquidated Damages – Amended Guidelines for Untimely Petitions and Mitigation of Claims

Recently, U.S. Customs and Border Protection (“CBP”) amended its guidelines for the cancellation and mitigation of claims for liquidated damages in situations where the Petitioner is late in filing claims for relief.  Petitions are considered “untimely” or “late” if they fall outside of the established regulatory time frames or after the expiration of any lawfully obtained extensions.  19 C.F.R. Part 172.

Under the new guidelines, untimely petitions will be accepted or considered only if the petitioner is able to demonstrate the existence of “extraordinary circumstances that prevented the petitioner from filing a timely petition or timely seeking a lawful extension of time in which to file a petition” (with limited exceptions).   The Fines, Penalties, and Forfeitures Officer will exercise his or her discretion in determining whether the Petitioner meets the “extraordinary circumstances” standard.

As far as mitigation is concerned:

In calculating the mitigated amount on a late petition, CBP (with limited exceptions) will:

1. Determine the base amount (i.e., the amount of mitigation that would have been afforded on a timely petition or the previously available option one amount).

2. Determine the “additional mitigation amount” by multiplying the full assessed amount of the claim by 0.1%  (.001) and then multiply by the number of days the petition is late.

3. The product will be the additional amount which will be added to the base amount to produce the mitigated amount applied to the untimely filed petition.

For example, a $100,000 liquidated damages claim for which a petition is filed 30 days late will be mitigated to the amount provided by the guidelines plus an additional amount calculated by the new formula (30 days late x .001 = .03 x 100,000 = $3,000 added charge.)

The above went into effect January 9, 2013.

As discussed above, untimeliness can result into substantial monetary loss.  Thus, it is best to consult with an attorney regarding the new guideline applications and exceptions.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

Customs Attorney: Confidential Treatment of Shipping Manifests

How can I prevent information about my imports from being available to the public?

As some of you may or may not be aware pursuant to the privacy statute, 19 C.F.R. § 103.31 (d), the public is allowed to collect manifest data (e.g., bills of lading) at every port of entry. The information is limited to vessel manifests (air, rail, and truck manifests will not be available to the general public in any form).

Websites such as panjiva.com and importgenius.com collect and publish names of importers/suppliers/manufacturers from vessel manifest data. This can be troubling for some because entities such as your competitors are able to access information related to the sourcing and/or manufacturing of your products. However, an importer/shipper may make a request for confidentiality. The confidential protection is valid for 2 years, after which time a renewal is needed. Send in renewal requests 60 days prior to the expiration of the 2 year confidentiality period.

If you need assistance in requesting such confidentiality contact a customs attorney who can help.

You may call us at 347-512-9007 for more information on your international trade and customs issues.