Foreign Trade Zone

Your International Gateway to U.S. and Global Markets

 

logoLocating or expanding your company's operations into a Foreign Trade Zone is a smart business strategy.
 
When operating from an FTZ, your company gains a distinct competitive advantage by receiving cost reductions in customs duties and fees, a strategic location and supporting services. 
 

For more information on how your business can benefit from being located in FTZ 30 or as an FTZ Subzone, contact Ben Kolenar | (801) 535-6647 | ben.kolendar@slcgov.com.

 

 

What is a Foreign Trade Zone?
 
​Foreign Trade Zones (FTZs) are federally-designated secure locations in the U.S. that are considered outside of the commerce of the U.S. The major advantage of merchandise admitted to an FTZ is that it is treated as though it were located outside the United States for customs duty purposes.
 
A firm can import goods or components into an FTZ without paying duties at that time. It can then warehouse, assemble, manufacture, package, test, grade, clean, mix, process, and exhibit merchandise in the FTZ. Duties are paid only when goods are shipped from the FTZ to U.S. destinations. Generally, no duty is payable on goods or products scrapped, transferred to another zone or exported. Accordingly, depending upon the nature of the operation taking place, tenants may eliminate, reduce or defer payment of Customs duties.
Foreign Trade Zone Defined
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Would I Benefit from an FTZ?

An FTZ can give you a competitive advantage if you do two of the following things:

  • Import goods that have a high duty rate.
  • Import and export goods.
  • Add value to goods through assembly, manufacturing, packaging, etc.
  • Combine foreign and domestic goods.

To quickly see the bottom line savings that your company can aquire through FTZ benefits, click here to use the FTZ savings calculator!

FTZ Benefit Qualifiers
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What are the Advantages of an FTZ?

FTZ Advantages - Distinct Economic Benefits

  • Manufacturers or distributors pay no duty on imported items or raw materials until such goods enter the commerce of the U.S.
  • Warehousing imported goods in the FTZ defers duty and improves cash flow
  • No Customs duty is assessed when re-exporting goods from the FTZ to foreign countries
  • Processing goods within the FTZ can eliminate or lower tariffs
  • FTZ users may submit one Customs Entry per week rather than submitting one Customs Entry per shipment. This can result in significant cost savings.
  • FTZ users may also receive permission from Customs to move imported items directly from ports to the FTZ, thereby avoiding delays at congested ports.

 

Benefits Explained

Defer customs duty

Defer customs duty and federal excise taxes. By bringing your international shipments into the Salt Lake City FTZ you may be able to defer any applicable customs duty and federal excise taxes until the merchandise leaves the zone to be consumed in the U.S. This is an excellent way to lower the cost of holding inventory until youíre ready to ship to market.

Eliminate duty and excise taxes

You may obtain permission from Customs to move merchandise directly from the port of arrival to the Salt Lake City FTZ, avoiding costly supply chain delays. You may also utilize weekly entry procedures to consolidate Customs reporting and reduce costs including broker fees and Merchandise Processing Fees (MPF).

Reduce dutiable tariffs

Goods from outside the U.S. may be imported into, and then exported from the Salt Lake City FTZ to locations outside of the U.S. without the payment of duty and excise taxes. Goods may also be imported into, and destroyed in the zone without the payment of duty and excise taxes.

No time constraints on storage

Merchandise entered into the U.S. on an entry for warehousing, temporary importation under bond, or for transportation and exportation may be transferred to the Salt Lake City FTZ in zone restricted status from the Customs territory to satisfy a legal requirement to export the merchandise.

Satisfy export requirements

For example, Consider a company that assembles all-terrain vehicles. Imported ATV tires are dutiable at 4%. If assembled into a finished ATV in an FTZ, the duty rate of the finished ATV (2.5%) can apply to the value of the tires resulting in duty reduction (inverted tariff).

Increased security/lower insurance costs

Customs security requirements and federal criminal sanctions are deterrents against theft. This may result in lower insurance costs and fewer incidents of loss of cargo admitted into the Salt Lake City FTZ.

Direct delivery

Direct delivery allows for immediate movement of foreign product off the pier upon vessel arrival. With prior approval from Customs, FTZ operators do not need to wait for Customs officers to be present before breaking seals or even shipping products. This advantage greatly reduces clearance delays, including long Customs inspections.
 
 
 
How Can an FTZ Give my Company a Competitive Edge
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