How to Calculate Duty Drawback on Export
Duty drawback is an export incentive given to exporters when customs duty paid on imported inputs is refunded after the final goods are exported. Indian exporters use duty drawback to reduce export cost and improve profit margin.
What Is Duty Drawback in Export?
Duty drawback means refund of customs duty paid on imported raw material, components or packaging material used in exported goods. If imported inputs are used in a product that is later exported, the exporter can claim a part of that duty back.
Duty Drawback Formula
Duty Drawback = FOB Value of Export × Applicable Duty Drawback Rate
The drawback rate is usually expressed as a percentage of FOB value and depends on the product’s HS/ITC-HS code and export conditions.
Duty Drawback Calculation Example
Suppose your export FOB value is ₹10,00,000 and the applicable duty drawback rate is 2%.
₹10,00,000 × 2% = ₹20,000 duty drawback
Who Is Eligible for Duty Drawback?
Generally, an exporter may be eligible when imported inputs are used in exported goods, the export is completed through a customs port, and the product falls under an applicable drawback schedule. Eligibility also depends on the type of export, shipping documents and customs compliance.
Documents Required for Duty Drawback
- Shipping Bill
- Commercial Invoice
- Packing List
- Bill of Lading or Airway Bill
- IEC certificate
- Bank Realisation Certificate, where applicable
Duty Drawback vs RoDTEP
Duty drawback mainly refunds duty paid on imported inputs used in exported goods. RoDTEP reimburses embedded taxes and duties that are not otherwise refunded. Many exporters check both schemes to understand their total export incentive benefit.
Common Mistakes Exporters Make
- Using the wrong HS/ITC-HS code
- Entering incorrect FOB value
- Not maintaining export documents properly
- Assuming every product is eligible for drawback
Use Our Free Duty Drawback Calculator
You can quickly estimate your export incentive using our free Duty Drawback / RoDTEP Calculator. Enter your FOB value and applicable rate to get an instant estimate.
Calculate Duty DrawbackFAQs
What is duty drawback in export?
Duty drawback is a refund of customs duty paid on imported inputs used in goods that are later exported.
How is duty drawback calculated?
It is generally calculated as FOB value multiplied by the applicable drawback rate.
Is duty drawback available on all exports?
No. Eligibility depends on product, export conditions and applicable government rules.