The Ministry of Finance (MOF) announced yesterday that it is expanding a duty drawback scheme on a variety of export items to help lower operating costs for the nation’s exporters, retroactive to Jan. 1.
The duty drawback, also known as the duty refund, is given on certain imported materials that are used to produce export products.
Local manufacturers importing these materials can apply for the tariff and commodity tax refund on a shipment-by-shipment basis when they export products made from the imported materials.
“The expansion will enhance the competitiveness of local exporters,” the ministry said in a statement.
Prior to the expansion, companies could not apply for duty drawbacks on a total of 1,802 imported materials, the statement said.
The latest duty drawback scheme would apply to 1,751 items, with most of these items’ tariff rates between 2 percent and 4 percent, while the other 51 items, including processed cheese, would retain their levies, a customs administration official surnamed Lin (林) said.
The action is expected to create a total of NT$319 million (US$10.98 million) in refunds per year, Lin said.
The chemicals, minerals, plastics, rubber, textiles, base metals and electrical engineering sectors would be the largest beneficiaries of the expansion, according to the ministry, which will issue an official announcement next week.
The ministry previously applied the duty drawback on 1,259 items in October 2011, to help local exporters in view of the South Korea-Europe free-trade agreement.