Two leading senators have proposed an amendment to the Customs and Trade Facilitation Reauthorization Act of 2006 that would simplify drawback procedures.

Drawback entitles companies to claim refunds of import duties on raw materials and components used in the production of finished goods that are then exported. Companies may also apply for duty refunds if the imported goods are destroyed or shipped back to the country of origin.

Relatively few companies have taken advantage of the program because of its complexity.

The amendment to the bill, S. 3658, was proposed by Sens. Charles Grassley, R-Iowa, and Max Baucus. D-Montana, the chairman and ranking member of the Senate Finance Committee.

Once the bill is passed by the Senate, it will go to conference to be reconciled with the House version of the legislation. "If all goes as planned, we may have a new drawback statute this year with implementation planned for 2008," said Edwin W. Van Ek, president of C. J. Holt & Co. Inc., which specializes in drawback. He also co-chairs the Drawback Committee of the American Association of Exporters and Importers.

Drawback reform is a long-cherished goal of the trade community.

Van Ek said the Senate is expected to act on the bill before the August recess and go to conference right after the recess.