Duty drawback is a refund or remission, in whole or in part, of a Customs duty, internal revenue tax, or fee. The amount of refund generally paid to a drawback claimant is 99% of the duties, internal revenue tax, or fee paid on goods, materials or components which are imported into the United States and subsequently exported or destroyed, in an unused condition, as either:
(1) a manufactured product from the imported merchandise or substituted domestic merchandise of the same kind and quality as the imported article(s), or a combination thereof; or (2) the same article in an unused condition or a substituted domestic article that is commercially interchangeable (fungible) with the imported merchandise.  There are a number of different kinds of duty drawback authorized under law and the statute providing for specific types of drawback can be found in 19 U.S.C. 1313 and the implementing regulations which are contained in Part 191 of the U.S. Customs Regulations (19 CFR Part 191). Any importer, exporter or third party seeking to enter into a duty drawback program should consult the referenced regulations. The drawback statute is complex and penalties can apply for non-compliance with the regulations. Also, Part 181 of the U.S. Customs Regulations should be consulted for merchandise that is subject to the NAFTA drawback and other duty-deferral programs.