Duty Credit Scrip is a certificate issued by the government to exporters that allows them to pay customs duties using the credit earned from export incentives.
How It Works:
- An exporter qualifies under a government export promotion scheme.
- The exporter receives a Duty Credit Scrip.
- The scrip can be used to pay customs duties on imports.
- In some cases, the scrip can be transferred to another importer.
Benefits:
- Reduces overall import duty burden
- Encourages exports through incentives
- Improves cash flow for exporters
- Can be used or traded for value
Example:
An exporter receives a Duty Credit Scrip for export performance and uses it to pay customs duty on imported raw materials.