NORWICH – Local companies may benefit from new legislation passed into law last week. A bill – initially proposed by New York Assemblyman Clifford W. Crouch (R-Bainbridge) – has been signed into law by Governor Cuomo, giving Chenango County’s pharmaceutical companies and others the authority to apply to the federal government for the institution of a foreign trade zone.
A foreign trade zone is a federal program that gives companies the opportunity to delay or elude tariffs on imported and exported goods and raw materials used for the manufacturing process. Without such an agreement, many companies would be at a disadvantage in a market that is highly competitive.
“The way it is now, when a company brings ingredients or raw materials for its manufacturing process into the U.S. from another country, those materials may be subject to import duties,” said Commerce Chenango President Steve Craig. Companies within a foreign trade zone can delay paying taxes on raw materials until a finished product leaves the specified zone. “If the finished product were to be re-exported, then the charges would not apply,” he said.