Discretionary Customs Rules Disrupt Exports

摘要

Taxes paid on inputs used for export production are refunded in most countries. In India, these refunds are available in two forms. One is the duty drawback, under which a rate is fixed for each product category, as a percentage of the FOB value of exports. This amount is paid in cash by customs authorities. For example, if a firm exported fabrics worth USus10 million and the drawback rate is 10%, the firm gets a check for USus1 million on presenting proof of shipment.