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Duty cut for Importers relying on contract manufacturing

The central board of indirect taxes and customs has brought job work under the ambit of import of goods at concessional rate of duty or IGCR rules allowing importers who rely on contract manufacturers to pay duty at concessional rate on material imported for domestic production of goods and providing services the absence of this facility had earlier constrained the industry especially those in MSME sector which did not have the complete manufacturing capacity in house the borad said In a statement on Tuesday.

Importantly even importers who do not have any manufacturing facility can now avail IGCR ,2017 to import goods at concessional custom duty and get the final goods manufactured entirely on job work basis.

Sensitive sectors such as gold articles of jewellery and other precious materials or stones have been excluded from this facility in another change importers bringing in capital goods at confessional Custom duty can clear them in domestic market on payment of duty and interest at a depreciated value, this the board said, would provide an incentive to manufacturers as they would be able to re-export capital goods after end of use the rule changes come at a time when government is focusing on encouraging manufacturing opportunities in India the changes address demand from trade and industry while enabling domestic manufacturing to become globally competitive and self dependent CBIC has laid down the process for importers which include a one time information to custom authority’s and furnishing a continuity bond further the procedure for availing confessional custom duty under these rules have been reviewed and rationalized the required information and records can be sent by email to the jurisdictional custom officer thereby obviating any physical interference the board said expert said the amendments will enable local players to adjust to the revised global manufacturing practices while providing certainty to trade

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