Business Standard

Fix duty drawback rates


The all-industry rates of duty drawback revised on Thursday shows only a marginal raise on 102 export items. The increase does not fully offset the taxes levied on raw materials, components, consumable­s that goes into export production.

The government should immediatel­y look into raising duty drawback further to fully cover all the levies to make exports more competitiv­e. With oil prices going up, rupee appreciati­ng, there is hardly any workable profit for export trade. The sufferings of the leather industry can be wiped out if 100 per cent taxes is compensate­d by way of duty drawback, not a mere 0.3 per cent. Further, in line with ease of doing business, the Ministry of Commerce and Industry should recommend a proposal to the Ministry of Finance, which can be incorporat­ed in the Budget — a self-fixation of brand rates of drawback by exporters themselves. Wherever duty drawback rates are not fixed as all-industry rate category, exporters have to seek brand rate fixation which takes a lot of time and a plethora of documents have to be submitted to get the rates fixed. Instead, exporters can self-calculate the duties that have gone into export production and straightaw­ay claim the brand rates similar to all-industry rates. Such an easy method of claiming brand rate duty drawback will alleviate exporters’ difficulti­es and save time. There are a host of items where import and re-export happen with value addition, but all-industry rates are not available. A serious thinking on these lines will enhance trade among Asean countries and may even double the total export value with these countries..

A Sathyanara­yana New Delhi

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