LxC81 ASSlS1AnCL lMC81 lAClLl1?

1Ax CCnCLSSlCnS Anu uu1?

u8AW8ACkS
8LSLn1Lu 8?
uLLSPlkPA ACA8WAL
PA8SPl1 MALPC18A
kAMAL kuMA8
kCMAL AC8AWAL
D|rector Genera| Cf Iore|gn 1rade
1he ulrecLoraLe ls headed by Lhe ulrecLor Ceneral of
lorelgn 1rade and ls responslble for
formu|at|ng
execut|ng Lhe lorelgn 1rade ollcy/ Lxlm pollcy
wlLh Lhe ob[ecLlve of promoLlng lndlan exporLs uCl1 also
|ssues ||censes Lo exporLers monlLors Lhelr
correspondlng obllgaLlons
Lxport romot|on Measures In Ind|a
W Lxc|se Duty kefund Lax lmposed by Lhe CenLral CovernmenL
on goods manufacLured ln lndla
W 1hls duLy ls collecLed aL source LhaL ls before removal of
goods from Lhe facLory premlses
W I|sca| |ncent|ves Lxempt|on from Income 1ax ln order Lo
enable Lhe exporLers Lo plough back Lhelr earnlngs and
promoLe exporLs Lhe CovernmenL has glven I1 exempt|on to
exporters under sect|on 80nnC of the I1ax Act
W Slmllarly |ong term tax ho||days are allowed Lo 100 LCus ln
deslgnaLed areas such as LZs SLZs eLc
Lxport romot|on schemes Incent|ves
Duty Lxempt|on Schemes Advance ||cense
Advance ||cense (author|zat|on% lssued Lo allow duLy free lmporL
of lnpuLs whlch are physlcally lncorporaLed ln exporL producL
1hese schemes are Advance Author|zat|on Duty Iree Import
Author|zat|on (DIIA)
Advance llcense holders are exempLed from paymenL of
customs duty
add|t|ona| customs duty
ant| dump|ng duty
educat|on cess
safeguard duty
Duty Lxempt|on Schemes Advance ||cense
W Duty Lxempt|on Schemes
1hls scheme ls consldered useful when a standard
product |s manufactured |n |arge quant|t|es standard
raw mater|a|s are used for product|on
uuLy free lmporL of mandaLory spares upLo 10 of Cll
value of llcense are also allowed
Lxport romot|on Schemes Incent|vesDuty
Lxempt|on kem|ss|on Schemes
uuLy LxempLlon schemes enable duLy free lmporL of
lnpuLs requlred for exporL producLlon
1he new scheme offers Lhe faclllLy Lo lmporL requlred
lnpuLs before Lhe exporLs a||ows transferab|||ty of
scr|p once the export ob||gat|on |s fu|f|||ed
uuLy remlsslon scheme conslsLs of
uuLy LnLlLlemenL assbook Scheme (uL8%
uuLy urawback scheme (u8k%
Lxport romot|on Schemes Incent|vesDuty
kem|ss|on Schemes
W under Lhls scheme granL of cusLoms duLy credlL agalnsL
Lhe exporLed producL ls provlded on Lhe lmporL conLenL
of Lhe producL exporLed
W 1he cred|t |s granted on post export bas|s as a
speclfled percenLage of lC8 value
W uL8 ls a fully Lransferable lnsLrumenL whlch can be
avalled of by Lhe manufacLurer as well as Lhe merchanL
exporLer
Duty kem|ss|on Schemes Duty drawback
Scheme (D8k)
uuLy drawback ls deflned as Lhe rebaLe of duLy
chargeable on any lmporLed or exclsable maLerlal used ln
Lhe manufacLure of goods exporLed from lndla
W 1hese are calculaLed Cn Lhe basls of average
consumpLlon of lnpuLs duLles Laxes pald quanLlLy of
wasLage exporL prlce of exporLed producLs
W 1hese are glven elLher on quanLlLy basls (per kg% or on ad
valorem basls (as of lC8 value% are revlewed and
revlsed perlodlcally
Market|ng Deve|opment Ass|stance (MDA)
W under MuA exporLers wlLh Lurnover upLo 8s 1300 crores
are ellglble for flnanclal asslsLance for a range of exporL
promoLlons acLlvlLles such as parLlclpaLlon ln 1rade lalrs
buyerseller meeLs abroad or ln lndla exporL promoLlon
semlnars eLc
W llnanclal asslsLance wlLh Lravel granLs ls avallable Lo
exporLers Lravellng Lo LaLln Amerlca Afrlca ClS reglon
ASLAn counLrles AusLralla new Zealand
Market Access In|t|at|ve (MAI)
W 1hls scheme ls lnLended Lo provlde flnanclal asslsLance for
medlum Lerm exporL promoLlon efforLs wlLh a sharp focus on
a counLry producL
W LxporL romoLlon Counclls (LC% lndusLry 1rade
AssoclaLlons Agencles of SLaLe governmenLs lndlan
Commerclal Mlsslons abroad are ellglble for asslsLance under
Lhls scheme
W 8ange of acLlvlLles can be funded by MAl scheme 1hese
lnclude markeL sLudles seLLlng up of
showrooms/warehouses sales promoLlon publlclLy
campalgns parLlclpaLlon ln lnLernaLlonal Lrade falrs eLc
W llnanclal asslsLance ranglng from 23 Lo 100 of LoLal cosLs
can be recelved
Served from Ind|a Scheme (SIIS)Serv|ce Lxports
W Cb[ecLlve ls Lo acceleraLe growLh ln exporLs of servlces so
as Lo creaLe a powerful unlque Served lrom lndla"
brand lnsLanLly recognlzed and respecLed
W All servlce provlders of servlces llsLed who have a LoLal
free forelgn exchange earnlng of aL leasL 8s 10 Lakhs ln
precedlng year wlll quallfy for duLy credlL scrlp equlvalenL
Lo 10 of free lL
Spec|a| Lconom|c 2ones(SL2)
W spec|f|ca||y des|gnated duty free enc|ave whlch shall be
deemed Lo be a forelgn LerrlLory for Lhe purpose of Lrade
operaLlons duLles Larlffs
W 1he pollcy provldes for seLLlng up of SLZ ln Lhe publlc
prlvaLe [olnL secLors or by sLaLe governmenLs 1he
CovernmenL has already converLed a number of LxporL
rocesslng Zones (LZ% Lo SLZ
W SLZ unlLs can reLaln 100 of Lhelr exporL proceeds ln
Lxchange Larner's lorelgn Currency (LLlC% accounL
Some of Lhe feaLures of SLZ are
Lxport Import Coods servlces golng lnLo Lhe SLZ area
from u1A shall be LreaLed as deemed exporLs and Lhe domesLlc
suppllers are ellglble for deemed exporL beneflLs
Slmllarly goods servlces comlng from SLZ area lnLo u1A
shall be LreaLed as lf Lhe goods are belng lmporLed 1he enLlre
producLlon of SLZ musL be exporLed u1A sales are permlLLed
only afLer paymenL of full appllcable cusLoms duLles
Act|v|t|es perm|ss|b|e lorelgn dlrecL lnvesLmenLs (lul% lul
upLo 100 ls allowed Lhrough auLomaLlc rouLe for all
manufacLurlng acLlvlLles excepL prohlblLed lLems
romot|ona| ackage LxempLlon from paymenL of CLu on
procuremenL of caplLal goods raw maLerlals consumable
spares eLc from Lhe domesLlc markeL
Lxport 1rad|ng nouses
W MerchanL as well as ManufacLurer LxporLers Servlce
rovlders LCus unlLs locaLed ln SLZs ALZs LlecLronlc
Pardware 1echnology arks (LP1s% SofLware 1echnology
arks (S1s% 8lo1echnology arks (81s% shall be ellglble
for sLaLus
SLaLus holder wlll be ellglble for a number of faclllLles
lncludlng
AuLhorlzaLlon cusLoms clearance for boLh lmporLs
exporLs on selfdeclaraLlon basls
100 reLenLlon of forelgn exchange on LLlC accounL
LnhancemenL of normal repaLrlaLlon perlod from 180 days
Lo 360 days
Ass|stance to States for Infrastructura|
Deve|opment of Lxports (ASIDL)
W under Lhls scheme Lhe ueparLmenL of Commerce provldes
funds Lo sLaLes for developmenL of lnfrasLrucLure on Lhe
basls of Lwln crlLerla of gross exporLs raLe of growLh of
exporLs ln such sLaLes
W Cb[ecLlves of ASluL lnclude developlng lnfrasLrucLure such
as roads connecLlng producLlon cenLres wlLh porLs
seLLlng up of lnLernal conLalner depoLs (lCu% conLalner
frelghL SLaLlons (ClS%
SeLLlng up of lnfrasLrucLure faclllLles llke roads power
sLablllzaLlon mlnor porLs effluenL LreaLmenL plans eLc
CreaLlon of SLaLe level lndusLrlal parks equlLy
parLlclpaLlon ln lnfrasLrucLure pro[ecLs
Scheme for sLaLus holder
1 AddlLlonal uuLy CredlL Scrlps shall be glven Lo SLaLus Polders [
1 of Lhe lC8 value of pasL exporLs acceleraLe exporLs and
encourage Lechnologlcal up gradaLlon
2 1hls faclllLy shall be avallable for secLors of leaLher (excludlng
flnlshed leaLher% LexLlles and [uLe handlcrafLs englneerlng
(excludlng lron sLeel nonferrous meLals ln prlmary and
lnLermedlaLe form auLomoblles Lwo wheelers nuclear
reacLors parLs and shlps boaLs and floaLlng sLrucLures%
plasLlcs and baslc chemlcals (excludlng pharma producLs%r
3 1hls faclllLy shall be avallable up Lo 31 March 2011
4 1ransferablllLy for Lhe uuLy CredlL scrlps belng lssued Lo sLaLus
holders under vkCu? Scheme permlLLed only for Lhe
procuremenL of cold chaln equlpmenLs
AsslsLance for marlne producL
W rllsherles exempLed from malnLenance of average
LC under LCC Scheme (along wlLh 7 secLors%
however llshlng 1rawlers boaLs shlps and oLher
slmllar lLems shall noL be allowed for Lhls exempLlon
W AddlLlonal flexlblllLy under 1argeL lus Scheme (1S%
/ uuLy lree CerLlflcaLe of LnLlLlemenL (ulCL% Scheme
for Lhe marlne secLor
AsslsLance for Cems and !ewellery secLor
W ruuLy urawback ls allowed on Cold !ewellery exporLs Lo
neuLrallze duLy lncldence
W lan Lo esLabllsh ulamond 8ourse (s% wlLh an alm Lo make
lndla and lnLernaLlonal 1radlng Pub announced
W lnLroducLlon of a new faclllLy Lo allow lmporL on conslgnmenL
basls of cuL pollshed dlamonds for Lhe purpose of gradlng/
cerLlflcaLlonrr
LCC Scheme
CbllgaLlon under LCC scheme relaxed
1o ald Lechnologlcal up gradaLlon of exporL secLor LCC
Scheme aL Zero uuLy has been lnLroduced
LxporL obllgaLlon on lmporL of spares moulds eLc
under LCC Scheme has been reduced by 30
AsslsLance for pharma exporLs
W rLxporL CbllgaLlon erlod for advance auLhorlzaLlons
lssued lncreased from exlsLlng 6 monLhs Lo 36
monLhs
W harma secLor lncluded under MLlS for counLrles ln
Afrlca and LaLln Amerlca some counLrles ln
Cceanla and lar LasL
AsslsLance for LxporLs CrlenLed unlLs
W LCus have been allowed Lo sell producLs manufacLured by
Lhem ln u1A (uomesLlc 1arlff Area% upLo a llmlL of 90 lnsLead
of exlsLlng 73 wlLhouL changlng Lhe crlLerla of slmllar goods
wlLhln Lhe overall enLlLlemenL of 30 for u1A sale (1hls
means LhaL lnsLead of 73 Lhese unlLs can sell up Lo 90 of
Lhelr producLs ln Lhe domesLlc markeLs%
W LCu allowed Lo procure flnlshed goods for consolldaLlon
along wlLh Lhelr manufacLured goods sub[ecL Lo cerLaln
safeguards
W LxLenslon of block perlod by one year for calculaLlon of neL
lorelgn Lxchange earnlng of LCus kepL under conslderaLlon
W LCu allowed CLnvA1 CredlL laclllLy
Support for Market and roduct
D|vers|f|cat|on
W 26 new markeLs have been added under locus
MarkeL Scheme
W 1he lncenLlve avallable under locus MarkeL Scheme
(lMS% has been ralsed from 23 Lo 3
W 1he lncenLlve avallable under locus roducL Scheme
(lS% has been ralsed from 123 Lo 2
W LxLra producLs have been lncluded ln Lhe scope of
beneflLs under lMS
Announcements for MDA MAI
Plgher allocaLlon for MarkeL uevelopmenL AsslsLance (MuA% and
MarkeL Access lnlLlaLlve (MAl% has been announced
1owns of Lxport Lxce||ence (1LL)
1he followlng clLles have been recognlzed as Lowns of exporL
excellence (1LL%
nand|crafts !alpur Srlnagar and AnanLnag
Leather roducts kanpur uewas and Ambur
nort|cu|tura| roducts Mallhabad
lMC81 lAClLl1?
8ASlC lAC1C8S lnlLuLnClnC lMC81
CLlC?
W 1he economlc needs of Lhe counLry
W effecLlve use of forelgn exchange
W lndusLrlal as well as consumer requlremenLs
C8!LC1lvLS Cl lMC81 CLlC?
W Cn Lhe lmporL slde Lhe pollcy has Lhree
ob[ecLlves
W Lo make necessary lmporLed goods more easlly
avallable lncludlng essenLlal caplLal goods for
modernlzlng and upgradlng Lechnology
W Lo slmpllfy and sLreamllne procedures for lmporL
llcenslng
W Lo promoLe efflclenL lmporL subsLlLuLlon and self
rellance
W lmporLs are allowed free of duLy for exporL
producLlon
W Lg
An LCu/LP1/S1/81 unlL may lmporL and/or
procure from u1A or bonded warehouses ln
u1A/lnLernaLlonal exhlblLlon held ln lndla wlLhouL
paymenL of duLy all Lypes of goods lncludlng
caplLal goods requlred for lLs acLlvlLles provlded
Lhey are noL prohlblLed lLems of lmporL ln Lhe l1C
(PS%
W lnpuL ouLpuL norms have been speclfled for
more Lhan 4200 lLems whlch Lell abouL Lhe
amounL of duLy free lmporL of lnpuLs allowed
for speclfled producLs
W 1here are no resLrlcLlons on lmporLs of caplLal
goods
W lmporL of second hand caplLal goods whose
mlnlmum resldual llfe ls of flve years ls
permlLLed
W LxporL romoLlon CaplLal Coods (LCC%
scheme provldes exporLers Lo lmporL caplLal
goods aL a concesslonary cusLom raLes ln Lhe
pasL 30 years lndlan lmporLs have rlsen qulLe
dramaLlcally
W AL presenL lmporLs accounLs for 17 of Lhe
Cu CaplLal goods have been conLlnued Lo be
lmporLed and ln Lhe lasL Lhree years Lhelr
share has fallen from 23 Lo 22
W A new 8dlglL commodlLy classlflcaLlon based
l1C Parmonlsed SysLem of codlng for lmporLs
were adopLed ln 2002 1he common
classlflcaLlon used by Lhe ulrecLoraLe Ceneral
of lorelgn 1rade (uCl1% and CusLoms helps
ellmlnaLe classlflcaLlon dlspuLes and reduce
LransacLlon cosLs and Llme
W 1he ueparLmenL of 8evenue MlnlsLry of llnance
CovernmenL of lndla has lssued a CusLoms noLlflcaLlon
no107/2008 noLlfylng Lhe duLy concesslons appllcable
for lmporL of abouL 239 speclfled lLems under SouLh
Aslan lree 1rade AgreemenL (SAl1A%
W appllcable for lmporL of speclfled lLems from four
counLrles namely 8ang|adesh 8hutan Ma|d|ves and
Nepa| Also Lhe exLenL of Larlff concesslon wlll be on
Lhe applled or sLandard raLe of lmporL duLy
1Ak CCNCLSSICNS
1ox lncentiveslnfrostructure sector
W 1he Lax lncenLlves offered Lo Lhe lnvesLors by Lhe CovernmenL
of lndla are a boon for flrms lnvolved ln l1 ouLsourclng Lo
lndla 1he lncenLlves LhaL faclllLaLe economlc growLh and
developmenL are
W 1 Infrastructure
W A 10 years Lax hollday Lo venLures engaged ln developlng and
/ or malnLalnlng and operaLlng an lnfrasLrucLure faclllLy
W 2 ower
W 10 years Lax hollday Lo underLaklngs whlch generaLe and / or
dlsLrlbuLe power
W 3 1e|ecom
W 3 years Lax hollday for companles provldlng Lelecom servlces
lncludlng lnLerneL servlces and broadband servlces Also 30
deducLlon from proflLs for Lhe nexL 3 years ln any 10
conLlnuous years ouL of flrsL 10 years ls also offered
1ox lncentives
W 4 Industr|a| arks and Spec|a| Lconom|c 2ones
W 10 years Lax hollday ls appllcable Lo venLures LhaL develop and /or
operaLe or malnLaln ln noLlfled l1 parks and speclal economlc zones
W S Cther Industr|es
W 3year Lax hollday ls avallable for new lndusLrlal unlLs Lo be seL up ln
backward sLaLes and dlsLrlcLs
W 6 Incent|ves for Lxports
W no 1ax ls deducLed on exporLers proflLs for unlL seL up on LZs
S1s LP1s l1Z and SLZs
W 7 Cther Incent|ves
W 1ax concesslons are allowed for l1l and a welghLed deducLlon of
130 for sclenLlflc research and developmenL expendlLure have
been offered 10 years Lax hollday ls avallable for 8u companles
engaged ln sclenLlflc and lndusLrlal research
AC8lCuL1u8L
W 1he varlous beneflLs offered by Lhe llnance MlnlsLer Lo
supporL agrlculLure secLor ln unlon budgeL 2010 are
W CompleLe servlce Lax exempLlon for Lhe esLabllshmenL and
sponsorlng of such apparaLus
W CompleLe cusLoms Lax exempLlon for refrlgeraLlon dlvlslons
requlred for Lhe producLlon of chllled vans or Lrucks
W 8eneflL of 3 concesslonal cusLoms Larlffs on parLlcular
agrlculLural equlpmenL noL creaLed ln lndla
W 1ax exempLlon from cenLral exclse Larlff on
parLlcular equlpmenL for conservaLlon and
processlng of agrlculLure and assoclaLed secLors
W 1ax exempLlon from servlce Larlff on Lhe
conservaLlon and warehouslng of farm produce
W Servlce Lax exempLlon on Lhe LesLlng and
documenLaLlon of agrlculLural seeds
W Servlce Lax exempLlon on Lhe LransporLaLlon of
cereals and pulses by rall and road
W Ind|rect 1axes
W 8esLore Lhe baslc duLy of 3 per cenL on crude peLroleum 73
per cenL on dlesel and peLrol and 10 per cenL on oLher reflned
producLs CenLral Lxclse duLy on peLrol and dlesel enhanced
by 8e1 per llLre each
W 1he governmenL has levled a one rupee per llLer exclse duLy
on gasollne and dlesel Lhls may lncrease LransporLaLlon cosL
W Agr|cu|ture ke|ated Sectors
W rovlde full exempLlon from cusLoms duLy Lo
refrlgeraLlon unlLs requlred for Lhe manufacLure
of refrlgeraLed vans or Lrucks
W rovlde concesslonal cusLoms duLy of 3 per cenL
Lo speclfled agrlculLural machlnery noL
manufacLured ln lndla
W rovlde cenLral exclse exempLlon Lo speclfled
equlpmenL for preservaLlon sLorage and processlng
of agrlculLure and relaLed secLors and exempLlon
from servlce Lax Lo Lhe sLorage and warehouslng of
Lhelr produce and
W rovlde full exempLlon from exclse duLy Lo Lrallers
and semlLrallers used ln agrlculLure
W 1o exempL Lhe LesLlng and cerLlflcaLlon of agrlculLural
seeds from servlce Lax
1hls wlll help Lo reduce Lhe cosL of cerLlfled seeds
manufacLurers and aL Lhe same Llme farmers can afford
lL aL lower prlce
W 1he LransporLaLlon by road of cereals and pulses Lo be
exempLed from servlce Lax 1ransporLaLlon by rall Lo
remaln exempL
W 1o ease Lhe cash flow poslLlon for smallscale
manufacLurers Lhey would be permlLLed Lo Lake full
credlL of CenLral Lxclse duLy pald on caplLal goods ln
a slngle lnsLallmenL ln Lhe year of Lhelr recelpL
Secondly Lhey would be permlLLed Lo pay CenLral
Lxclse duLy on a quarLerly raLher Lhan monLhly
basls
W 8educLlon ln baslc cusLoms duLy on long pepper from
70 per cenL Lo 30 per cenL
W 8educLlon ln cenLral exclse duLy on laLex rubber
Lhread from 8 per cenL Lo 4 per cenL
W Lxclse duLy has been rolled back Lo 10 from
8 Cwlng Lo Lhls SLeel AuLhorlLy of lndla
(SAlL% ls expecLed Lo ralse long producL prlces
by 8s1000 a Lon ln March ln order Lo pass on
Lhe hlgher duLy burden
SLZ
W A Speclal Lconomlc Zone (SLZ% ls a geographlcal
reglon LhaL has economlc laws LhaL are more
llberal Lhan a counLrys Lyplcal economlc laws
1he caLegory SLZ covers a broad range of more
speclflc zone Lypes lncludlng lree 1rade Zones
(l1Z% LxporL rocesslng Zones (LZ% lree Zones
(lZ% lndusLrlal LsLaLes (lL% lree orLs urban
LnLerprlse Zones and oLhers usually Lhe goal of a
sLrucLure ls Lo lncrease forelgn dlrecL lnvesLmenL
by forelgn lnvesLors Lyplcally an lnLernaLlonal
buslness or a mulLlnaLlonal corporaLlon (MnC%
1Ax CCnCLSSlCnS 1C SLZ's
W exempLlon from cusLoms duLy on goods lmporLed
lnLo Lhe SLZ by Lhe ueveloper or SLZ unlL Lo carry
on Lhe auLhorlsed operaLlons
W exempLlon from cusLoms duLy on goods exporLed
from Lhe SLZ by Lhe ueveloper or SLZ unlL Lo any
place ouLslde lndla
W exempLlon from exclse duLy on goods broughL
from uomesLlc 1arlff Area (u1A% Lo Lhe SLZ by
Lhe ueveloper or SLZ unlL Lo carry on Lhe
auLhorlzed operaLlons
W LxempLlon from CaplLal Calns
CaplLal galns arlslng on Lransfer of asseLs
(machlnery planL bulldlng land or any rlghLs
ln bulldlngs or land% on shlfLlng of Lhe
lndusLrlal underLaklng from an urban area Lo
any SLZ would be exempL from caplLal galns
Lax
W no 1uS by Cverseas banklng unlLs (C8us% on
lnLeresL on deposlLs/borrowlngs from non
resldenL or person noL ordlnarlly resldenL
SLZ's
W Income tax
W ueducLlon from roflLs and Calns from exporL
of goods/servlces as follows (SecLlon 10AA%
100 lncome Lax exempLlon for flrsL 3 years
30 lncome Lax exempLlon for nexL 3 years
W no MA1 (Mlnlmum AlLernaLe 1ax%
Ind|rect taxes
W SLZ unlLs may lmporL or procure from Lhe
domesLlc sources uuLy free all Lhelr
requlremenLs of caplLal goods raw maLerlals
consumables spares packaglng maLerlals offlce
equlpmenL uC seLs eLc for lmplemenLaLlon of
Lhelr pro[ecL ln Lhe Zone wlLhouL any llcense or
speclflc approval
W no lmporL duLy on Lhese goods lmporLed
W no exclse duLy on Lhese goods procured from
u1A (uomesLlc 1arlff Area%
W no servlce Lax on servlces avalled from u1A
(uomesLlc 1arlff Area%
W no value Added 1ax (vA1% and CenLral Sales 1ax
(CS1% on goods procured from u1A (uomesLlc
1arlff Area%
W Cn goods procured from u1A drawback under
secLlon 73 allowed Lo SLZ unlL
W Coods lmporLed/procured locally duLy free could
be uLlllsed over Lhe approval perlod of 3 years
CLMS Anu !LWLLLL8?
W Import dut|es
W 8educe Lhe lmporL duLy on boLh Cold and
Sllver lncludlng preclous meLal scrap and
should be allowed aL 0 (zero% duLy
W 8educe lmporL duLles on flnlshed [ewellery
lnLo lndla
W 8ecommends unlform vA1 raLes of 1 Lo be
lmplemenLed across lndla and malnLaln Lhe
same raLe ln addlLlon Lhe above clarlflcaLlon
ls Lo be glven Lo all sLaLes LhaL vA1 seL off ls Lo
be allowed when raw maLerlal ls lssued from
one sLaLe Lo anoLher sLaLe for manufacLurlng
of [ewellery
uu1? u8AW8ACkS
SCPLML
WPA1 lS uu1? u8AW8ACk SCPLML?
W under Lhe uuLy urawback Scheme
admlnlsLered by CusLoms CenLral Lxclse
ueparLmenL Lhe duLles pald on lnpuLs and
servlce Lax pald on lnpuL servlces used ln Lhe
manufacLure of exporL goods are refunded Lo
Lhe exporLers ln Lhe form of drawback 1he
drawback raLes are worked ouL and noLlfled
every year afLer Laklng lnLo accounL Lhe
budgeLary changes ln Lhe duLy sLrucLure and
oLher relevanL facLs
W 1he exerclse ls underway ln Lhe MlnlsLry Lo re
work and revlse Lhe raLes of duLy drawback for
Lhe year 20092010
W All lndusLry 8aLes of uuLy urawback are
worked ouL by conslderlng Lhe consumpLlon
of lnpuL maLerlals/ servlces and Lhe lncldence
of duLles/Laxes on Lhese lnpuL maLerlals/
servlces
klnuS Cl u8AW8ACkS
W Unused Merchand|se
lmporLed merchandlse ls unused and exporLed or
desLroyed under CusLoms supervlslon 99 percenL of
Lhe duLles Laxes or fees pald on Lhe merchandlse may
be recovered as drawback
W Subst|tut|on Unused Merchand|se
Merchandlse LhaL ls commerclally lnLerchangeable wlLh
lmporLed merchandlse upon whlch duLles and Laxes
were pald and LhaL has noL been used ls exporLed or
desLroyed under CusLoms supervlslon 99 percenL of
Lhe duLles Laxes or fees pald on Lhe merchandlse may
be recovered as drawback
W ke[ected Merchand|se
Merchandlse ls exporLed or desLroyed because lL
does noL conform wlLh samples or speclflcaLlons or
has been shlpped wlLhouL Lhe consenL of Lhe
conslgnee or has been deLermlned Lo be defecLlve
as of Lhe Llme of lmporLaLlon 99 percenL of Lhe
duLles whlch were pald on Lhe merchandlse may be
recovered as drawback
W D|rect Ident|f|cat|on Manufactur|ng lf arLlcles
manufacLured ln Lhe unlLed SLaLes wlLh Lhe use of
lmporLed merchandlse are subsequenLly exporLed
or desLroyed Lhen drawback noL exceedlng 99
percenL of Lhe duLles pald on Lhe lmporLed
merchandlse may be recoverable
W Subst|tut|on Manufactur|ng
8oLh lmporLed merchandlse and any oLher
merchandlse of Lhe same klnd and quallLy are
used Lo manufacLure arLlcles some of whlch
are exporLed or desLroyed before use Lhen
drawback noL exceedlng 99 percenL of Lhe
duLy whlch was pald on Lhe lmporLed
merchandlse may be payable on Lhe
exporLed/desLroyed arLlcles
now to Cbta|n Drawback
W 1he guldellnes for compleLlng a drawback clalm are
provlded ln Lhe CusLoms 8egulaLlons more speclflcally
19 Cl8 191 SubparL L We can help you wlLh Lhe
appllcaLlon process prepare lnvenLory record and flle
Lhe clalm
W 1he locaLlons for flllng a drawback clalm are 8osLon
Chlcago PousLon Los Angeles Mlaml new Crleans
newark and San lranclsco
W A drawback enLry and all documenLs necessary Lo
compleLe a clalm generally musL be flled wlLhln Lhree
years afLer exporLaLlon or desLrucLlon of Lhe arLlcles
MANUIAC1UkING DkAW8ACk
kULINGS
1o obLaln drawback a manufacLurer or producer of arLlcles lnLended
Lo be clalmed for drawback musL flrsL apply for a manufactur|ng
drawback ru||ng 1here are Lwo Lypes of manufacLurlng drawback
rullngs (1% Ceneral and (2% Speclflc
(1)Genera| Manufactur|ng Drawback ku||ng
Ceneral manufacLurlng drawback rullngs are provlded for ln SecLlon
1917 of Lhe CusLoms 8egulaLlons (19 Cl8 V1917% and are
deslgned Lo slmpllfy drawback for cerLaln common manufacLurlng
operaLlons
W (2% Spec|f|c Manufactur|ng Drawback ku||ng
Where a manufacLurer or producer cannoL follow
any one of Lhe prescrlbed general manufacLurlng
rullngs wlLhouL varlaLlon Lhe manufacLurer or
producer musL apply for a speclflc manufacLurlng
drawback rullng under SecLlon 1918 Sample
formaLs for speclflc manufacLurlng drawback
rullngs are conLalned ln Appendlx 8 Lo arL 191
CusLoms 8egulaLlons (19 Cl8 arL 191%
Lxport rocedure
uuLy urawback for asL LxporLs Walver form
requlremenL of prlor noLlce of lnLenL Lo exporL musL
be supporLed by a dlrecL lnvenLory ldenLlflcaLlon
meLhod
1he condlLlons for ldenLlflcaLlon by accounLlng
meLhod are
W 1he loLs of merchandlse musL be funglble
W lnvenLory records musL esLabllsh LhaL Lhe loLs
so ldenLlfled as belng recelved lnLo and wlLhdrawn
from Lhe same lnvenLory are belng used ln Lhe
ordlnary course of buslness
W All recelpLs lnLo and all wlLhdrawals from Lhe
lnvenLory musL be recorded ln Lhe accounLlng
record Sub[ecL Lo verlflcaLlon by CusLoms
W lL musL be used wlLhouL varlaLlon for a perlod of
aL leasL one year unless approval ls glven by
CusLom for a shorLer perlod
W Wa|ver of r|or Not|ce of Intent to Lxport
ou may be e||g|b|e for Wa|ver of r|or Not|ce
under Sect|on 19191 of the Customs
kegu|at|ons 1he approva| |s based on the
subm|ss|on of an app||cat|on and comp||ance
w|th the regu|at|ons
W C|a|m er|od
In the case of unused merchand|se drawback |t
|s necessary to estab||sh that the merchand|se
was exported or destroyed w|th|n three years
from the date of |mport
W In the case of re[ected merchand|se drawback
you must estab||sh that the merchand|se was
returned to Customs custody w|th|n three years
after |t was or|g|na||y re|eased from Customs
custody
W In the case of manufactur|ng drawback you
must estab||sh that manufactured art|c|es on
wh|ch drawback |s be|ng c|a|med were exported
w|th|n f|ve years from the date of |mport
ayment of Drawback C|a|ms
W When a clalm has been deLermlned Lo be
compleLe and saLlsfles all drawback
requlremenLs Lhe drawback amounL ls verlfled
and Lhe enLry llquldaLed for Lhe refund due
urawback ls payable Lo Lhe exporLer/desLroyer
unless Lhe rlghL Lo clalm drawback has been
Lransferred Lo a Lhlrd parLy Lhrough a CerLlflcaLe
of uellvery and/or ManufacLure lurLhermore
Lhe exporLer/desLroyer musL cerLlfy LhaL
drawback on Lhe parLlcular exporLaLlon or
desLrucLlon wlll noL be asslgned Lo any oLher
parLy
1PAnk ?Cu