New Delhi, March 12
THE Government has hiked the all-industry rate of duty drawback for furnace oil supplied by domestic oil companies to export-oriented units (EOUs) under the deemed export scheme.
As against the prevailing rate of Rs 1,050 per tonne, the Directorate General of Foreign Trade (DGFT) has now pegged the all-industry rate of duty drawback at Rs 1,300 per tonne. The Government had last month raised the duty drawback rate from the then existing level of Rs 925 per tonne to Rs 1,050 per tonne.
Similarly on the special economic zones (SEZ) front, the duty drawback rate on furnace oil supplied by domestic oil companies as physical exports to units in SEZs has been increased from Rs 1,050 per tonne to Rs 1,300 per tonne.
The main purpose of granting duty drawback was to ensure supply of furnace oil to EOUs/SEZs at international prices. Drawback payments are made to exporters to neutralise the customs and excise duties paid on inputs used in the manufacture of exportable products.
Informed sources said that the latest revision has been made to factor in the changes in excise duty on inputs. "When the last revision was made, the changes in customs duties were alone factored in and not that of the excise duties on inputs. Now the revision has factored in the changes to the excise duty on inputs," they said.
Prior to February 2005, the rate of duty drawback for furnace oil was set at Rs 925 per tonne in May 2003.