In an ever-increasing competitive business climate, the focus on cost savings and efficiency is paramount. By taking advantage of the benefits offered by Foreign Trade Zone No. 241, businesses operate on a more level playing field with their
international competitors to increase their profitability.
FTZ’s assist businesses by creating and retaining jobs and encouraging investment in the U.S. By helping local employers remain competitive, FTZs contribute to maintaining or boosting employment opportunities. Lower FTZ-based production costs encourage increased investment in U.S. facilities.
In a FTZ, users are allowed to elect a zone status on merchandise admitted to the zone. The status determines the duty rate when and if it is entered into U.S. commerce from the FTZ. This allows users to elect the lower duty rate applicable to either the foreign inputs or the finished product manufactured in the zone. If the rate on the finished product is lower than the rate on the inputs, the FTZ user may choose the finished product rate, thereby reducing the amount of duty owed.
Customs duties are paid only if and when merchandise enters U.S. commerce. This benefit equates to a cash flow savings that enables companies to keep critical funds accessible for their operating needs while the merchandise remains in the zone. There is no limit on the length of time that merchandise can remain in a zone.
Duty is not paid on merchandise exported from a FTZ. Therefore, duty is also eliminated on merchandise exported from the FTZ. Generally, duties are also eliminated for merchandise that is scrapped, wasted, tested, or destroyed in a zone.