Exporters seek simplification of drawback schedule

A section of knitwear exporters in Tirupur knitwear cluster who met the members of Duty Drawback Committee, set up by Union Ministry for Finance, here, have sought simplification of the drawback schedule and an upward revision in the drawback rates for apparels.

The Duty Drawback Committee chairman, Saumitra Chaudhari, and a few other members came to the cluster on Wednesday evening as part of the exercise initiated by the Union Finance Ministry for fixing the All Industry Rates (AIR) of Duty Drawback for 2013-14 financial year. Sources said AIR was worked out by considering the consumption of input materials/services and the incidence of customs and central excise duties and service tax on such materials/services.

The committee members reminded the exporting fraternity that duty drawback is not an incentive scheme rather it being a tax refund scheme by which various central taxes paid in the manufacture of export goods were refunded. Tirupur Exporters’ Association president A. Sakthivel appealed to the committee that the duty drawback on readymade garments need to be increased from the present 7.9 per cent considering the stiff competition faced by Indian exporters in the global market and the subsequent reduction in the average unit value realisation of garments.

Mr. Sakthivel also highlighted the increase in the cost of production of apparels during the last few years.

Officials from Apparel Export Promotion Council were present.

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