Revised Duty Drawback Rates (All Industry): Amended w.e.f. 11 Feb., 2016

All Industry Rates of Duty Drawback

A. Amendments to the Schedule of All Industry Rates of Duty Drawback w.e.f. 11 Feb 2016

The Government considered representations, feedback and data related to the All Industry Rates (AIR) of Duty Drawback that took effect on 23.11.2015 and has notified certain changes vide Notification No. 22/2016- Customs (N.T.) dated 08.2.2016. These changes take effect from 11.02.2016. The notification should be downloaded from and perused. The changes made, inter-alia, include –

(a) AIR of drawback is being provided to rice packed in PP/HDPE bags;

(b) Separate tariff entries with AIRs (including caps) are being created for “hair-on” varieties of mats/carpets and other articles under heading 4303; for yarns of cotton blended with MMF under heading 5206; fabrics of MMF blended with wool under heading 5515; jackets/blazers of cotton containing 1% or more by weight of elastane under headings 610302/610402/620302/620402; blankets of MMF under heading 6301; flat-rolled products of stainless steel of thickness of 0.25 mm or less under heading 7220; hollow drill bars and rods of non-alloy steel under heading 7228; cages under heading 8482;

(c) Sub-headings under four digit heads of 8409, 8413, 8481 and 8708 are being restructured to distinguish drawback caps for products exported;

(d) Descriptions of certain tariff items are being amended to include certain products, for example, „notebooks‟ are being included in tariff items 482006 and 482007. The tariff items 610403 and 620403 are being expanded to include „dresses, skirts, undivided skirts‟. In tariff items 741998 and 741999, „bushes‟ are being also shown to address classification issue.

(e) Drawback rates/caps are being increased for tariff items 560802 (fishing nets) and 950610 (sports nets). All footwear of headings 6401 and 6402 is being provided with composite AIRs.

(f) Drawback caps are being increased for certain existing tariff lines like 42020301 and 42020401 (leather articles); 5508 (sewing thread of MMF); 551505, 551506, 551603 and 551604 (MMF fabrics); 640301 and 640305 (leather footwear); 7310 (steel tanks, cans etc.); 8701 (tractors). Caps are being raised for certain carpets made of wool, silk, MMF and cotton of Chapter 57 and certain parts/components of Chapter 84-85. In respect of certain items of stainless/alloy steels of Chapter 72, the caps are being adjusted.

CBEC Circular No. 06/2016-Customs dt. 9th Feb 2016

CBEC Notification No. 22 / 2016 – CUSTOMS (N.T.) dt. 8th Feb., 2016

B. Government notifies Schedule of Enhanced / Revised All Industry Rates of Duty Drawback effective from 23rd November, 2015

The revised rates of duty drawback are based on average incidence of Customs and Central Excise Duties and Service Tax related with the manufacture of export goods and involve substantial total drawback for exporters. Apart from the rate changes, many new items have been included to better differentiate export products with higher duty incidence and also to address classification issues. Brand rate route has been extended to wheat export. A provision has been made to pay provisional drawback to exporters soon after export in case of certain exports made under claim for brand rate of duty drawback.

To expeditiously address exporters’ concerns, if any, arising from the new Schedule of Rates, feedback from Export Promotion Councils shall be taken into account by an Expert Committee that shall make further recommendations in January 2016 to the Government.

Schedule of Revised All Industry Rates of Duty Drawback (dbk schedule 2015-16) effective 23 November 2015

Custom Notification No. 110/2015-Cus(NT), dt. 16.11.2015 – Notifying All Industry Rates (AIR) of Duty Drawback w.e.f. 23.11.2015

Custom Notification No. 109/2015-Cus(NT), dt. 16.11.2015 Making amendment to The Customs, Central Excise Duties and Service Tax Drawback Rules 1995

CBEC Circular No.29/2015, dated 16-11-2015

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