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EXPORTS FRAMEWORK POLICY,SCHEMES AND PROCEDURES

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Title: Export - Import Policy Author: L.B.Singhal Last modified by: fieo5 Created Date: 10/30/2000 1:26:51 PM Document presentation format: On-screen Show (4:3) – PowerPoint PPT presentation

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Title: EXPORTS FRAMEWORK POLICY,SCHEMES AND PROCEDURES


1
EXPORTS FRAMEWORK POLICY,SCHEMES AND PROCEDURES
  • 9th November 2010

2
Taxes and Duties
  • Central Basic customs duty, additional Customs
    duty, special additional duty, education
    surcharge, service tax ,CST.
  • State VAT, Electricity duty, Octroi, Mandi Tax,
    Turnover tax, Purchase tax, Luxary Tax,
    Entertainment Tax, Entry Tax in lieu of Octroi.
  • Export Duty.
  • GST CGST,SGST,IGST.

3
Service Tax Refund
  • 18 services eligible for refund.
  • Details available at www.cbec.gov.in
  • Refund only for service tax paid on specified
    services
  • Provided no CENVAT benefit has been availed

4
Procedure
  • Manufacturer exporter to excise having claim over
    factory
  • Others to excise having jurisdiction over
    regd./head office
  • Before that STC is alloted to applicant
  • Claim to be filed within 1 year from export from
    LEO

5
Procedure(Contd.)
  • No claim less than Rs 500
  • If claim is upto 0.25 of fob ,document or
    application to be self certified
  • If claim is more than 0.25 of fob ,document or
    application to be CA certified

6
Zero Rebating of Exports
  • No tax or duty on exports.( Export tariff
    aberration)
  • No Excise duty or VAT on final product.
  • Rebating of service tax on output services
  • Other Central taxes refund through duty
    refund/exemption schemes.
  • State Tax Except VAT ,rest are not refunded.

7
IEC
  • Permanent Code issued by DGFT
  • Application Form
  • Fee of Rs 250
  • Copy of PAN
  • Copy of bankers Certificate
  • Declarations
  • Exempted Categories

8
BIN
  • Software generated at Customs
  • Transmission of IEC
  • 15 digit
  • PAN FT 001 and so on

9
RCMC
  • Issued by Councils/Boards/Authorities
  • Form
  • IEC
  • Membership Fee

10
Shipping Bill
  • Shipping bill for export of goods under claim for
    duty drawback/DEPB etc.
  • Shipping Bill for export of dutiable goods.
  • Shipping Bill for export of duty free goods.(Free
    or White )
  • Shipping bill for export of duty free goods
    ex-bond i.e. from bonded warehouse

11
Bank Certificate of Exports Realisation
  • Exports documents to be presented to bank within
    21 days
  • Advance payment and status holders exempted
  • After negotiation Bank Certificate of exports
    and subsequent to realisation banks issue BRC
  • Required for claiming various benefits

12
Examination by Customs
  • Invoice
  • Packing list
  • ARE 1
  • Rule 18
  • Rule 19

13
ARE 1
  • Excise document for export clearance prepared
    in quintuplicate . Bears running serial number
    beginning from the first day of the financial
    year.
  • Original White
  • Duplicate Buff
  • Triplicate Pink
  • Quadruplicate Green
  • Quintuplicate Blue

14
MATE RECEIPT
  • An acknowledgement of cargo receipt signed by a
    mate of the vessel.
  • The possessor of the mate's receipt is entitled
    to the bill of lading, in exchange for that
    receipt.

15
BILL OF LADING
  • A  document issued by a carrier  to a shipper,
    acknowledging that specified goods  have been
    received on board for delivery to the consignee
  • Evidence of a valid chartering contract and
    may incorporate the full terms of the contract
    between the consignor and carrier.

16
BOL
  • Receipt signed by the carrier confirming goods
    matching the contract description have been
    received in good condition
  • A document of transfer, being freely transferable
    but not negotiable instrument
  • It governs all the legal aspects of physical
    carriage and like a cheque  or other negotiable
    instrument may be endorsed

17
Straight /Order BOL
  • A straight bill of lading is a non-negotiable
    document, made out to a specifically named
    consignee
  • An Order bill of lading is a document that is
    made out to the order of the foreign importer /
    its bank/ export firm/ its bank, or another
    designated party.

18
FT(DR) Act
  • FT(DR) Act repealed Import and Export (Control)
    Act, 1947.
  • FT(DR )Act, 1992 provide for development and
    regulation of foreign trade by facilitating
    imports and augmenting exports .

19
FOREIGN TRADE POLICY
  • Section 5 of Foreign Trade (Development and
    Regulation) Act, 1992 empowers the Central
    Government to notify the Exim (FT) Policy.
  • Para 2.4 of Foreign Trade Policy empowers
    DGFT to notify procedures

20
FOREIGN TRADE POLICY 2009-14
  • Basic objective
  • To double our global share of merchandise and
    services exports by 2014.
  • Provide stability to Policy with continuation of
    Schemes.
  • Diversify our product and market base.
  • Reduce transaction time and cost

21
Imports/Exports
  • All Imports/Exports are free except for the items
    shown as Prohibited/Restricted/State trading
    enterprises.
  • Import/Export permitted from/to any destination
    .Import/export of arms and related material
    from/to Iraq and North Korea prohibited

22
Imports/Exports (Contd)
  • Prohibited goods- Not allowed except in
    exceptional cases with approval of Central
    Government.
  • Restricted goods May be allowed under a licence
    or through a public notice.
  • STE goods- May be imported/exported by STE(s)
    or with a licence from DGFT.

23
Pre-requisite of Import/Export
  • Importer-Exporter Code (IEC)- Mandatory except
    for exempted categories in paragraph 2.8 of
    Handbook of Procedure
  • Documentation- Application form with fee .
  • Copy of PAN.
  • Copy of bankers
    Certificate
  • Declaration regarding NRI interest

24
EXPORT PROMOTION SCHEMES
  • Export Promotion Capital Goods Scheme.
  • Duty Exemption Scheme.
  • VKGUY
  • Focus Product, Focus Market and Market linked
    Focus Product Scheme
  • EOU/SEZ Scheme
  • Status holder Scheme.

25
Export Promotion Capital Goods Scheme
  • Import of capital goods at a concessional basic
    customs duty of 0 for selected sectors and 3
    allowed(for all sector) for export purposes. .
  • Spare ,Jigs ,fixture ,dies and moulds also
    allowed.
  • Second hand CG without any age restriction
    permitted under the Scheme.

26
Conditions of Exports
  • Export to be effected equivalent to 8 times (5
    times for agro, cottage and tiny sector and 6
    times for SSI units)of the duty saved on capital
    goods .
  • Exports to be completed in 8 years/12 years time.
  • For Zero duty,6 times in six years.
  • 12 years for duty savedgt Rs 100 Cr , and units in
    agro, cottage and tiny sector.

27
Conditions of Exports (Contd)
  • Export of goods capable of being manufactured by
    use of capital goods.
  • EO could be discharged by export of goods
    produced in different manufacturing unit of the
    company.
  • Facility to meet 50 of EO by exports of
    additional items from the same company/group
    companies permitted.

28
Duty Exemption/Remission Scheme
  • Advance Authorisation.
  • Annual Advance Authorisation
  • Duty Free Import Authorisation .
  • Duty Entitlement Pass Book Scheme.
  • Duty Drawback Scheme

29
Advance Authorisation
  • Duty Free import of inputs allowed for exports.
  • Minimum 15 value addition to be achieved.
  • Exports/Imports to be completed in 24 months.
  • Bond / BG / LUT to be given to the Custom
    Authorities.

30
Advance Authorisation
  • Advance License indicates description of export
    items, quantity of export item, FOB value of
    exports, description of import items, quantity of
    import items and CIF value of imports.
  • Import of inputs exempted from Basic Customs
    duty, Additional Customs duty and
    Safeguard/Anti-dumping duty.

31
Annual Advance Authorisation
  • Available only to status holders and exporters
    with 2 years exports.
  • Entitlement equivalent to 300 of the FOB value
    or Rs 1 crore ,whichever more in preceding year.
  • Authorisation valid for 24 months imp/ exports.

32
Annual Advance Authorisation (Contd..)
  • Licence only mentions the export product group,
    CIF value and FOB value.
  • Licence holder can export any product falling
    under the product group including items for
    which norms do not exist.
  • Only one licence for one product group or port of
    registration.

33
Duty Free Import Authorisation
  • New Scheme effective from 1st May,2006
  • Exporter allowed to import inputs free of Basic
    Customs and or Additional /SAD duty.
  • DFIA indicates names and quantity of the
    raw-material to be allowed duty free.
  • Minimum value addition of 20 required.

34
Duty Free Import Authorisation (Contd.)
  • DFIA and/or material imported under it
    transferable after completing EO.
  • Scheme covers only products for which Standard
    Input Output Norms exist.
  • Additional Customs duty is refunded through
    CENVAT or drawback in case of transferabilty.
  • CENVAT permitted under the scheme.

35
Duty Entitlement Pass Book Scheme
  • Substitution Drawback Scheme under ASCM
  • Aims to neutralize incidence of customs duty on
    import content of export product,
  • Exporter entitled for credit at a pre-specified
    rate of FOB value of exports.
  • Rates dependent on SION, value addition and
    Basic Customs duty.

36
Duty Entitlement Pass Book Scheme (Contd)
  • Credit can be utilised for import of items
    otherwise freely importable except capital goods.
  • For edible oil debit could be only upto 50 from
    DEPB.
  • Basic Customs duty, Additional Customs duty
    debitble from DEPB .
  • Validity 24 months and upto the last day of the
    month.

37
Drawback Scheme
  • All-Industry for a product by all companies
    /firms
  • Brand Rate Exclusive to a company/firm for a
    product
  • AIDBK not available
  • Refunds less than 4/5th of duties

38
Drawback Scheme(contd)
  • New Drawback Schedule notified from 17th Sept
    2010
  • Most drawback rates are specific as against
    ad-valorem
  • Drawback Schedule covers now about 1400 products.

39
VKGUY
  • Objective to promote agriculture, forest produce
    and their value added forms, Forest produce and
    Gram Udyog Products
  • Benefit of 5 transferrable duty free credit
    entitlement for products given in App 37 A .
    3when exporter uses imported inputs under
    Advance authorisation or claim DEPB/DBK of over
    1.
  • EOUs not availing 10 B benefits also eligible.

40
Focus Market Scheme
  • To offset high freight cost and other
    externalities to select international market.
  • Benefit of 3 transferrable duty free credit
    entitlement for countries given in App 37 C.
  • EOUs/STPs/EHTPs not availing 10 B benefits also
    eligible.

41
Focus Product Scheme
  • To incentivise exports with high employment
    intensity in rural and semi urban areas
  • Benefit of 2 transferrable duty free credit
    entitlement for products given in App 37 D .
  • EOUs/STPs/EHTPs not availing 10 B benefits also
    eligible.
  • Special Focus Products under table 2 and 5 to be
    given 5

42
Market Linked Focus Product Scheme
  • Benefit is given on a product country matrix
  • 2 transferable duty free credit entitlement for
    listed products to specified countries
  • Exclusivity Only one of the benefit of
    FMS,FPS,MLFPS or VKGUY can be claimed.

43
Served From India Scheme
  • Accelerate growth of services exports and create
    Served from India brand
  • All service providers with foreign exchange
    earning of Rs 10 lakh and more eligible
    .Individual with Rs 5 lakh forex earnings also
    eligible.
  • Entitled for 10 duty free credit of current
    year forex earnings.

44
Served From India Scheme(Contd.)
  • Duty free Credit to be used for imports of
    capital goods office equipments, spares,
    professional equipments, office furniture
    consumables
  • Domestic procurement permitted
  • Not transferrable (except within Group Company
    and Managed Hotels)

45
Export Oriented Units
  • Introduced in early 1981 (Prakash Tandon
    Committee) to offer duty and control free regime
    of export production without location binding.
  • Units for manufacturing and services (no trading
    permitted)
  • Only projects having minimum investment of Rs 1
    Cr in plant machinery except specified sectors.

46
Export Oriented Units (Contd)
  • Facilities
  • Import/ Export all goods except prohibited
  • Exemption from IT under section 10B
  • Exemption from industrial licensing for SSI
    items
  • 100 FDI permitted through Automatic route as
    applicable to SEZ.

47
Export Oriented Units (Contd)
  • 100 of export earnings in EEFC
  • Export remittance within 12 months.
  • OBU to extend the credit on same terms as
    extended to units in SEZ
  • DTA sale up to 50 of FOB value of exports

48
Export Oriented Units (Contd)
  • NFEP to be positive over 5 years.
  • Supplies to these units deemed exports.
  • Re-imbursement of CST on goods manufactured.
  • Remission of Service Tax
  • Exemption from excise on domestic procurement

49
Special Economic Zones
  • Scheme announced in March, 2000.
  • Foreign territory for taxes and duties
  • Goods from DTA to SEZ exports, reverse process
    imports.
  • Developers of SEZs eligible for tax/duty
    exemptions

50
Special Economic Zones(Contd)
  • Facilities for developer
  • IT exemption as per 80 IA of IT
  • Import/procurement of CG and inputs without
    customs/excise duty
  • Exemption from CST
  • Exemption from Service Tax

51
Special Economic Zones(Contd)
  • Facilities for units
  • Import/ Export all goods except prohibited
  • Exemption from Income Tax
  • Exemption from industrial licensing for SSI
    items
  • 100 FDI permitted through Automatic route .

52
Special Economic Zones (Contd)
  • NFEP to be positive over 5 years
  • 100 of export earnings in EEFC
  • Export remittance without any time limit.
  • OBU to extend the credit on international
    benchmarks.
  • DTA sale without any limit subject to NFE
    positive on applicable duties.

53
Special Economic Zones(Contd)
  • No interference from the Custom Authorities
    inside the zone
  • Supplies to these units physical exports.
  • Exemption of CST on goods manufactured.
  • Exemption of Service Tax

54
STATUS SCHEME
Category Total exports during current plus 1/2/3 years
EXPORT HOUSE Rs 20 Cr
STAR EXPORT HOUSE Rs 100Cr
TRADING HOUSE Rs 500 Cr
STAR TRADING HOUSE Rs 2500 Cr
PREMIER TRADING HOUSE Rs 7,500Cr
55
Facilities To Status Holders
  • Automatic issuance of Authorisation
  • 100 in EEFC
  • Direct negotiation of documents
  • Fixation of Norms in 60 days
  • Exemption from BG.
  • Accelerated Customs clearance under ACP
  • Status Holder Incentive Scrip

56
Status Holder Incentive Scrip
  • Leather(excl finished),Textiles Jute,
    Handicrafts Engineering (except metals in primary
    or intermediate forms, automobiles,two wheelers,
    nuclear reactors ,ship boats and floating
    structures),Plastic and Basic Chemicals(excl
    Pharma)
  • Incentive_at_1 for exports in 2009-10 , 2010-11and
    2011-12
  • Actual User for imports of capital goods
  • Beneficiary of TUF not eligible

57
Status Holder Incentive Scrip New Products
  • 1 Chemical Allied Products (other than Bulk
    minerals, Granite/Stones,Processed minerals,
    Cement, Clinkers
  • and asbestos)
  • (i) Rubber products, 4001 to 4010,4014 to 4017
  • (ii) Paints, Varnishes Allied Products 3208,
    3209,3210
  • (iii) Glass and glassware Chapter 70
  • (iv) Plywood and allied products Chapter 44
  • (v) Ceramics / refractories Chapter 69
  • (vi) Paper, Paper Boards Paper products Chapter
    48
  • (vii) Books, Publications Printings Chapter 49
  • (viii) Animal By-products (Codes35030030, ,
    05069099, 05079010,05079020, 05079050, 23011010,
  • 23011090, 96062910, and 96063010)
  • (ix) Ossein GelatineCodes05061039 and 35030020
  • (x) Graphite Products (Codes 3801,85451100 and
    85451900)
  • Explosives (Codes 3601, 3602 and 3603)
  • (xi) Misc. Products (Codes 3201,32029010,
    32030010, 3604, 3605, 38021000)

58
Status Holder Incentive Scrip New Products
  • Electronics Products
  • Sports Goods and Toys
  • Chapter 95and Codes420321,650610
  • Engineering products for the three groups
    indicated below Chapter 72
  • (i) Iron and Steel
  • (ii) Pipes and tubes
  • (iii) Ferro Alloys

59
  • THANK YOU ALL
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