CMA Final · Indirect Tax Laws and Practice · Duty Drawback
Under Section 74 of the Customs Act, 1962, drawback on re-export of duty-paid imported goods is allowed at what percentage of the duty paid on importation, subject to the conditions in the section?
Ninety-eight per cent of the import duty paid is repaid as drawback under Section 74 when the goods are re-exported, provided they are identified as the imported goods and are entered for export within the prescribed period. The other figures do not match the statute.
- A100 per cent
- B98 per centCorrect
- C95 per cent
- D90 per cent
Explanation
Section 74(1) provides that ninety-eight per cent of the duty paid on importation shall be re-paid as drawback where the conditions of identification and timely entry for export are met. The 100 per cent figure ignores the statutory 2 per cent retention.
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