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The Central government has significantly reduced the drawback rates on the export of gold and silver jewellery.
This adjustment was made in response to a substantial cut in import duties on these precious metals announced in the Budget.
The drawback rate refers to the percentage or amount of refund that a business can claim on the import duties, taxes, and fees it paid on goods that were later exported in a different form.
The purpose of the drawback rate is to eliminate the additional costs associated with import duties, which would otherwise make exported goods more expensive and less competitive in the global market.
When a company imports raw materials, components, or goods into a country, it typically pays import duties and taxes.
If these imported goods are used in the production of other goods that are then exported, the government allows businesses to reclaim or "draw back" some or all of the duties and taxes paid on the imported items.
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