Impact of US Reciprocal tariffs for Importing and Exporting Goods from USA

[Sameer Annigeri]

Dear Sir/Madam,

We need one Legal advisory on Impact of US Reciprocal Tariff for following transactions.

1) Indian Entity is sending Material to US for Job Work purpose, after completion of the process, Indian Entity will re-import the material. In this case US is charging Customs duty. Is there any way to get the duty exemption. 

2) US entities sending the material to India for Job Work. After processing the job work service Indian entities will send back (Export) the parts to the USA. In this case what is the customs duty implication in the USA.

Request you to please check and confirm.

[YAGAY andSUN]

 The impact of U.S. reciprocal tariffs on job work transactions depends primarily on whether the movement of goods is structured as a temporary import or as an import for consumption. Where an Indian entity sends material to the U.S. solely for job work and re-imports the same goods after processing, U.S. customs duty, including any applicable reciprocal tariff, can be avoided or substantially mitigated only if the goods are imported under a recognised temporary admission mechanism such as Temporary Importation under Bond (TIB) or, where eligible, an ATA Carnet, subject to strict compliance with re-export conditions and timelines. In the absence of such a mechanism, U.S. Customs is legally justified in levying full customs duty and additional reciprocal tariffs at the time of import. Conversely, where U.S. entities send material to India for job work and the processed goods are exported back to the U.S., the re-importation into the U.S. is treated as a fresh import from India and is ordinarily liable to normal customs duty as well as applicable reciprocal tariffs, unless relief is claimed under specific HTSUS Chapter 98 provisions or through duty drawback mechanisms based on prior duty payment and re-export. Accordingly, to minimise tariff exposure, it is critical that both inbound and outbound job work transactions are pre-structured under appropriate temporary import, re-export, and drawback regimes, with precise customs documentation and compliance at both ends of the transaction.

AI Summary

Goods sent abroad for processing and re-imported: temporary admission can avoid U.S. duties; other returns face normal import duties Where goods are sent to the U.S. by an Indian entity for job work and subsequently re-imported, the operative clarification is that customs treatment depends on qualification for temporary admission regimes (e.g., Temporary Importation under Bond or ATA Carnet); if imported under such regimes and re-exported in compliance with conditions and timelines, U.S. duty and reciprocal tariffs are avoidable or mitigable. Where U.S. entities send goods to India for processing and the processed goods are later returned to the U.S., the operative clarification is that re-entry is treated as an import for consumption and is ordinarily subject to normal customs duty and any reciprocal tariffs unless relief is claimed under HTSUS Chapter 98 entries or duty-drawback provisions, in which case duties may be refunded or relieved.