Indian Ministry of Finance reduces leather drawback duty rates
The Indian Ministry of Finance has announced significant changes in duty its drawback system, which affect many industries including the leather sector, which has seen the rate of duty decreased on certain items and increased on others.
In the leather sector, the drawback rates have been reduced by 20% on seven items which include leather footwear (64.01) and leather footwear uppers (64.10), industrial leather gloves (42.11), leather sandals (64.04) etc and 10% on two items, namely, leather bags (42.05) and other leather gloves (42.13). The new drawback rate for leather footwear (64.01) is 7.9% subject to a maximum of Rs.61/pair. On two items: lining leather (41.01) and rubber canvas footwear (64.08) the drawback rates have been increased by 20% and on one item, leather sandal upper (64.13) the rate has been increased by 10%. On seven items which included leather apparel (42.09), leather wallets/purses etc (42.07), finished leather (41.02), the drawback rates remain unchanged.
The method of calculating drawback rates has also altered in that most of the amounts will now be quoted in metric tones/kg to increase transparency and to avoid disputes and litigation. This system has replaced the more antiquated number, pieces and gross method employed up until now.
The new rates became valid as of January 19, 2005.
