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! I !i'.; <br />FORTH CAROLINA <br />the state of minds <br />INCENTIVES - FOREIGNTRADE ZONES <br />i;! < What is a Foreign Trade Zone? <br />A Foreign or Free Trade Zone is a neutral, secured area legally outside of U.S. Customs territory. <br />Foreign or domestic merchandise may enter this enclave without a formal customs entry or the <br />payment of customs duties or government excise taxes, and without a thorough examination. If the <br />final product is exported from the UnitedStates, no Customs duty is levied. If the final product is <br />imported into the U.S., duty and excise,,:., axes are due at the time of transfer from the foreign trade <br />zone and formal entry is made into.-the U.S. Duty is paid on the product itself or its imported parts, <br />whichever is lower. Spoiled, or damaged goods or waste materials may be disposed or re- exported <br />without payment;of duty, — <br />Economic Benefit?of Foreign Trade Zones <br />Foreign. Tadones provide a myriad of economic advantages for businesses involved in <br />international "trade. Primarily, merchandise may be manipulated, used in a manufacturing process, <br />';21jnspecte'd, combined with other domestic or foreign materials, displayed for sale and /or re- exported <br />thout payment of duty. Savings on personal property, � sales and use taxes are possible since state <br />and local governments generally do not impose such taxes on items in an FTZ. Additional savings on <br />interest, labor and shipping costs may also result. <br />rvrr1611 n auc wuca <br />North Carolina Deparbizent of Commerce Incentives 19 <br />