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Govt hikes duty drawback rates for some items
Feb '16
The Central Government has modified duty drawback structure by increasing rates or caps on some products like leather items, steel tanks and also added new classification for several items including cotton yarn mixed with MMF with effect from 11 February.

"The government considered representations, feedback and data related to the All Industry Rates (AIR) of Duty Drawback that took effect on November 23, 2015 and has notified certain changes...," a Central Board of Excise and Customs (CBEC) notification said on Tuesday.
Duty drawback is refund of duties on imported inputs for export items.

As per the notification, drawback rates/caps have been increased for fishing nets and sports nets.

Drawback caps have also been increased for leather articles, leather footwear, steel tanks, cans and tractors. Caps have also been raised for certain carpets made of wool, silk and other fabrics.

The notification also said in respect of certain items of stainless or alloy steels, the caps have been adjusted.

Drawback caps are imposed on several export products with an aim to obviate the possibility of misuse by over invoicing of the export value.

Descriptions of some tariff items have been amended to include certain products, like notebooks, dresses, skirts and undivided skirts.
New entries in the Drawback Schedule have been created for cotton yarns mixed with MMF – both grey and dyed. The Cotton Textiles Export Promotion Council (Texprocil) has welcomed the Government decision.

“I am glad the Government has accepted our proposal for a separate entry for cotton yarn mixed with MMF,” R.K. Dalmia, Chairman of Texprocil said in a press release.

The Govt has also increased the Drawback caps in the case of certain MMF fabrics. Dalmia appreciated the Government for considering the feedbacks on the Drawback rates and anomalies that have arisen under the Drawback Schedule and addressing them.

However, Dalmia pointed out that in the product coverage there are some clarifications needed with regard to the classification of some high valued items like “Boiler Suits” and “Protective wear” made of blend containing cotton and manmade fibres” which are technical textiles products for which the market is growing. (SH)

Fibre2Fashion News Desk – India

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