Ohio Logistics opens the whole world to companies because we operate out of Foreign Trade Zone #151. It provides users with the opportunity to lower costs and boost profits. It can improve cash flow by delaying, reducing, or eliminating duties.

The Foreign Trade Zone (FTZ) is a program created by the Federal Goverment, which has exsisted since the 1930s, and it is thriving today. Its purpose is to facilitate trade and increase the global competitivness of U.S.- based companies.

Legally, a Foreign Trade Zone is an area within the United States that the Goverment considers outside the country, or at least, outside of the U.S. Customs territory. Certain types of merchandise can be imported into a Zone without going through formal Customs entry procedures or paying import duties.

In the Foreign Trade Zone, foreign and domestic merchandise is generally considered to be international commerce. Foreign or domestic merchandise may enter this enclave without a formal customer’s entry or the payment of custom duties or government excise taxes.

Through Tall Timbers' distribution services, merchandise entering the foreign trade zone may be stored, tested, sampled, relabeled, repackaged, displayed, repaired, manipulated, mixed or cleaned.

It may also be assembled, manufactured, salvaged, destroyed, or processed.

If the final product is exported from the United States, no U.S. customs duty or excise tax is levied. However, if the final product is imported into the United States, customs duty and excise taxes are due only at the time of transfer from the Foreign Trade Zone and formal entry into the United States occurs.

12 Money-Saving Reasons for Distribution
Services in the Foreign Trade Zone

Reason #1: Warehouse your imports in the foreign trade zone and delay paying duty until they are shipped to your customers. Delayed duty payments mean savings to your company.

Reason #2: Sort, test and repackage foreign goods in the foreign trade zone before exporting them back overseas. Duty is never paid!

Reason #3: Use the foreign trade zone when the duty rate on the parts is higher than the duty rate on the finished product. A company can therefore import parts duty-free, assemble a final product and be required only to pay the duty on the final product.

Reason #4: Duties are reduced or eliminated on materials subject to defect, damage, obsolescence, waste, or scrap.

Reason #5: Merchandise may be exported and returned to an FTZ without duty payment.

Reason #6: Spare parts may be stored, returned, or destroyed without duty payment.

Reason #7: Delays in Customs clearances and duty drawback are reduced or eliminated.

Reason #8: Duties are not owed on labor, overhead, or profit attributed to FTZ production operations.

Reason #9: Quality control inspections can identify sub-standard goods to be destroyed or returned without duty payment.

Reason #10: Use the foreign trade zone when the duty rate on the parts is less than the duty rate on the whole. Duty rate paid is only that appropiate for the foreign parts only.

Reason #11: Goods in FTZ #151 normally avoid federal excise taxes. Goods in the FTZ may also be exempt from Ohio inventory taxes and/or Ohio commercial activity taxes, and Ohio tangible personal property tax.

Reason #12: The Trade Development Act of 2000 contains a provision permitting FTZ "Weekly Entry" procedures which can help zone users save time and money. The provision allows users to file entries and pay fees on goods moving through the zone once a week, rather than once a day or multiple times each week as had previously been the case.

Personal Property Taxes not Assessed On Inventory Held at Tall Timbers Distribution Center!

Tax Commissioner Opinion 90-0006 states that within zones granted prior to January 1, 1990, "any tangible personal property" (not including that personal property listed on Schedules 2 and 4 of an Ohio personal property return) as defined in R.O. 5709-44 (A) (I) and which is located within the.....Foreign Trade Zone is exempt from personal property tax. Therefore only property commonly reported as "inventory" for personal property tax purposes qualifies for exemption under R.O. 5709-44. "Tangible personal property includes all "inventory" of a merchant and a manufacturer whether imported to Ohio, held for export from Ohio, or manufactured in Ohio.

* The Tax Commissioners Opinion means that ALL inventory held at Tall Timbers Distribution Center is exempt from Ohio personal property taxes

Case of Foreign Fortunes

In today’s just-in-time manufacturing environment, many companies avoid foreign suppliers even when quality and cost make these foreign parts highly desirable. Unfortunately, many manufacturers tend to avoid foreign affairs altogether.

One appliance manufacturer uses Ohio Logistics to overcome the problems of distance.

Suppliers ship their parts to Ohio Logistics where the parts are unpacked, inventoried and made ready for the customer. Suppliers maintain ownership of their parts in the Foreign Trade Zone until Ohio Logistics ships the part on time and in the proper quantity to the customer.

Actually the suppliers are the "real customers" of Ohio Logistics, but the appliance manufacturer is the beneficiary of the association.