How Can A Product Be Imported Tariff-Free To Miami Without Entering The U.S.? Welcome To The FTZ

Tucked among the warehouses that edge the Everglades, just west of the Florida Turnpike in Miami-Dade County, lies a doorway unlike most.

It’s marked with a red-lettered warning sign between two Department of Homeland Security logos. Step through it, and—at least for trade purposes—you’ve left the United States.

“You are actually exiting the commerce of the United States,” said Gary Goldfarb, chief strategy officer at Interport, a logistics, warehousing, and distribution company based in Miami. “You’re entering what is essentially foreign territory.”

No passport is needed. And no tariffs apply.

Goldfarb is a local expert on Foreign Trade Zones (FTZs)—also known as “free tariff zones.” His warehouse, perched at the edge of a limestone quarry, is one such zone. Inside, pallets of tools, patio umbrellas, and even toilets tower more than ten feet high. Some are labeled “domestic,” destined for the U.S. Others are clearly marked “FTZ,” indicating their next stop is another country.

These goods have arrived from countries like India, Vietnam, and China. If they’re headed into the U.S. market, they’re subject to tariffs—some newly imposed under President Donald Trump. But if they’re just passing through this FTZ en route to other destinations, no U.S. tariff is owed, as long as the goods remain in this specially designated warehouse.

Most items in this warehouse are bound for the Caribbean, Central America, or South America—making them exempt from U.S. import taxes.

“All you’re doing here is pausing in foreign territory before deciding the goods’ final destination,” Goldfarb explained. It’s a kind of trade limbo that keeps U.S. tariffs at bay.

That’s the appeal of FTZs—and why Florida hosts over a dozen of them, with more than 100 sites scattered across South Florida.

“Foreign trade zones are a tool,” said Goldfarb—not just for warehousing and logistics, but also for managing cash flow and financing.

Some Chinese-made goods now face tariffs as high as 145%. For example, a $100 pair of sneakers from China could incur an additional $145 tax if sold in the U.S. This upfront cost can hurt a company’s finances because tariffs must be paid when the goods enter the country, not when they are sold.

“Most importers never dealt with high duties before,” Goldfarb noted. “They don’t have the credit lines to absorb that kind of hit, so they’re in trouble.”

Stay, Wait, And Don’t Pay

To avoid paying tariffs right away, many companies choose to store products in an FTZ. Technically, the goods haven’t entered the U.S., so no tariffs are due until they leave the zone and are brought into the country.

In Broward County, near the Fort Lauderdale-Hollywood International Airport, Harry Boden manages a similar operation for Toyota Tsusho America. On the floor of his warehouse, a lime-green painted area marks U.S. territory. Beyond it is the FTZ, lined with shelves of auto parts—from tiny screws to large bumpers.

Passing through a small gate marked “Anzen” (Japanese for “safety”) takes you into this tax-free trade space.

“There are no taxes paid here because it’s a bonded facility,” Boden explained. “We can consolidate parts from around the world and ship them out. The only duties paid are those owed in the final destination.”

Toyota vehicles across the Caribbean are serviced with parts from this facility. Although the parts are made in Asia, they stop in Fort Lauderdale and then head out tax-free to countries like Aruba, Jamaica, and the Bahamas.

“Many companies use this model,” said Jorge Hernandez, business development director at Port Everglades, which oversees this FTZ. “They bring in goods from all over and distribute them from Broward County.”

Boden called the FTZ designation “crucial” to Toyota’s regional operations.

“We couldn’t serve customers in over two dozen countries without it,” Bodoen said.

On the shipping dock, pickup truck liners from Argentina were being prepped for export to the Dominican Republic. If brought into the U.S., those parts would face a 25% tariff under Trump-era policies.

Foreign Trade Zones have been around since the 1930s, born in response to another trade war. They were created just four years after the infamous Smoot-Hawley Tariff Act, which triggered global retaliation and deepened the Great Depression.

Upwards of $25 billion worth of merchandise moves through Florida’s foreign trade zones, ranking it fourth among states for exports passing through.

Even French wines or Jamaican rum that is served onboard cruise ships can be brought in, sit in a foreign trade zone near PortMiami or Port Everglades and taken to a ship’s lounge without paying U.S. taxes. Three of the top 15 zones nationwide are in South Florida, according to a 2023 report to Congress.

It’s a ranking helped by South Florida’s geography. And Goldfarb said they give the region’s economy an edge as new tariffs take hold.

“ We have foreign trades and we have all the tools necessary to help our clientele reduce the impact of tariffs as much as possible. Companies are flocking to Miami because Miami is that community that has all of that knowledge,” Goldfarb said as he swiped his security card, opening the door between the FTZ and his office.

No passport — and no tariffs — needed.

Source: WLRN