The Town of Islip Foreign Trade Zone Authority is one of the Island's most valuable resources for companies that engage in international trade. Legally, a foreign trade zone is an area within the United States that is considered outside of U.S. Customs territory. Consequently, you can import certain types of merchandise into an FTZ without going through formal customs entry procedures or paying import duties.
There are many benefits to being located in a FTZ which make a FTZ a more profitable way for local businesses to reduce costs and compete in the international marketplace.
For more information on how much you can save, take a look at our interactive estimated savings calculator by clicking here
One major benefit is increased cash flow from keeping the goods out of US Customs territory. Duties are paid on merchandise when it is entered into US Customs Territory. By deferring this payment, the business has the use of its money for the interim period thereby keeping these funds available for its operations.
Another advantage of using a Zone is that cargo may be exported, transferred from zone to zone, stored indefinitely or destroyed without the payment of any duties.
Inverted tariff relief is yet another benefit available in a Zone. Finished products manufactured or assembled in a FTZ from components purchased abroad may be subject to an even lower rate of duty. With inverted tariff relief, a manufacturer may elect to pay duty on the component parts or the finished product, whichever rate is lower.
Other benefits that can be realized through the use of a FTZ are:
Which permit zone users to file one entry as opposed to multiple entries throughout the week significantly reducing paperwork and expense.
This eases the movement restrictions of merchandise in and out of the country.
Which do not apply to goods admitted to zone - quotas do apply to goods entered into US Customs territory, however the goods which can be stored in the FTZ can be among the first to enter the US market when the quota is eased.