Drawback

Drawback is a refund of customs duties paid on imported goods that are exported or used in producing exported goods. This incentive reduces cost for exporters.

Goods eligible for drawback include raw materials, components, and packaging used in exported products.

Exporters must submit claims for drawbacks along with documentation such as shipping records, customs forms, and proof of export. Refunds apply to duties like import taxes, value-added taxes (VAT), and specific tariffs.

Countries implementing drawback schemes include the United States, Japan, China, and Germany.

Documented examples prove its effectiveness in boosting a country’s export activities.