- 5 Marks
Question
What constitutes “Duty Drawback” and what are the types of “Duty Drawbacks” in customs administration?
Answer
A Duty Drawback is a regime that allows a refund of duties to an importer on account of re-exporting the same goods or after processing those goods into finished products for re-export. This system encourages exportation.
Types of Duty Drawbacks:
- Material Duty Drawback
- Same State Duty Drawback
Material Duty Drawback:
It is a refund of duty on materials imported into the country, processed into finished goods for re-export. The duty paid is refunded to the importer as an incentive.
(1.5 marks)
Same State Duty Drawback:
This is a refund of duty on goods imported into the country and re-exported in the same state they were imported. The packaging, contents, and condition remain unchanged.
(1.5 marks)
- Tags: Duty Drawback, Export Incentives, Import duty, Tax Refund
- Level: Level 3
- Topic: Duty Drawbacks, International taxation
- Series: MAY 2018
- Uploader: Cheoli