ISLAMABAD: Federal Board of Revenue is yet to revise the duty drawback rates on the import of certain raw materials/inputs used in the manufacture of export goods. The revision is required under standard duty drawback notifications after budget 2013-14.
Sources said that duty drawback standard SROs are required to be revised in case there is 15 percent increase/decrease in rate of the customs duty on the import of raw materials etc to be used in the export goods.
This has been specified in the relevant rules dealing with the duty drawback rates. However, there is no major change in the rates of the customs duty on the import of inputs consumed in the manufacture of export goods under Pakistan Customs Tariff (PCT). Therefore, FBR has not amended the standard duty drawback notifications during 2013-14.
Every year, it is general practice that FBR revises the duty drawback rates in view of the prevailing exchange rate of dollar against the rupee and tariff reductions made in the federal budget. As there is no major revision in duty structure on the import of materials in 2013-14, the annual revision of duty drawback rates has not been done incorporating the new exchange rates.
At present, standard duty drawback notifications i.e. SRO.209, SRO.2010, SRO.2011 and others are dealing with the duty drawback regime. For the calculation of duty drawback rates, important factors like new rate of customs duty, exchange rate, revised customs tariff, Cost and Freight (C&F) value i.e. import value of inputs goods and Freight on Board (FOB) value of exported goods have to be taken into account.
However, the revised calculation of duty drawback rates has been carried out in case when there is a requirement to revise the rates. The payment of duty drawback has been done on the basis of FOB value of the export goods or weight calculated in kilograms, depending on the type of product specified in the standard duty drawback notifications. Thus, there is no need for annual revision of duty drawback rates during current fiscal year following tariff rationalisation in budget 2013-14.