Duty & Tax Drawback

Turn Compliance Into Competitive Advantage

Most alcohol, extract, flavoring and tobacco/nicotine manufacturers overpay federal excise taxes and customs duties without realizing it. Enter 'Drawback'. At Novel CPG, this is the kind of innovative regulatory operations work we specialize in and it’s an area we’re particularly excited to help clients explore. We guide you through the complexity, navigating compliance, designing systems, and managing the necessary documentation, so your business retains more of what it earns. Drawback programs can also be structured to offset future excise taxes and customs duties, creating ongoing savings that improve margins and operational efficiency.

What is Drawback?

What is Excise Tax & Duty Drawback? These are federal programs administered by U.S. Customs and Border Protection (CBP) and the TTB that allow companies to recover excise taxes and customs duties paid on qualifying alcohol or tobacco ingredients and finished products. In regulated alcohol, extract, and tobacco industries, this applies to exported products, non-beverage formulas, manufactured tobacco products or papers, destroyed inventory, or eligible direct identification and substitution imports/exports. The program predates the U.S. dollar as a hallmark of American manufacturing strategy, reflecting a long-standing federal approach to support domestic producers. In practice, it allows businesses to reclaim taxes that would otherwise remain a sunk cost and reinvest those funds into growth and operations.

Sectors Served:

Perfume
Fragrance
Cosmetics
Nicotine

Bev Alc
Extract
Flavoring
Tobacco
Personal Care
Dietary Supplements

Excise Tax Drawback

Recovering federal excise taxes paid to the TTB on substances utilized in non-beverage formulations, final manufacturing or lost during production.

Customs Duty Drawback

Reclaiming import tariffs paid to U.S. Customs by matching imported alcohol or tobacco components with comparable exported finished goods.

Billions of dollars go unclaimed every year

...many companies simply don’t realize they qualify.

The process is complex and documentation-heavy

...which is why many businesses avoid it.

Taxes are one of your largest hidden costs

...Drawback can reduce the costs and expand margins.

Our role: We simplify, manage, and maximize your claims.

Learn how we helped a global spirits giant unlock millions in excise-tax savings through Drawback, all while strengthening cross-functional organization.

Read the Case Study

Our Drawback Services

Following our proprietary approach built on

cross-functional expertise for maximum refund.

1 / Eligibility Assessment

Analyze your supply chain to identify drawback opportunities.

2 / Program Design

Build a compliant, scalable system tailored to your operations.

3 / Implementation

Align finance, legal, and operations to capture refunds.

4 / Ongoing Management

Maintain records, filings, and compliance to keep funds flowing.

5 / Audit Readiness