The bonded input supplies warehouse scheme in Ethiopia

The bonded input supplies warehouse scheme

Bonded input supplies warehouse means a warehouse under the joint control of the Ethiopian Revenues and Customs Authority and the supplier concerned, where raw materials and accessories imported free of duty by a licensed supplier are stored until such time as they are sold to producers.

Beneficiaries of the bonded input supplies warehouse scheme shall be persons who have obtained certificate of eligibility from the Ministry of Industry and who have warehouses meeting the standards set by the Ethiopian Customs Commission.

Currently, the Ethiopia government implements the following export trade incentive schemes;

These are;

a) The duty draw-back scheme;

b) The voucher scheme;

c) The bonded export factory scheme;  

d) The bonded manufacturing warehouse scheme;

e) The bonded input supplies warehouse scheme; and

f) The industrial zone scheme.

In this article we will see the fifth scheme, the bonded input supplies warehouse scheme

Procedures for the Application of Bonded Input Supplies Warehouse Scheme are the following;

These are;

First Input supplies imported by beneficiaries of the bonded input supplies warehouse scheme shall be transported from a customs post to such warehouses under the control of customs without being subject to payment of duty.

Next, Ethiopian Customs Commission shall inspect input supplies brought into and taken out of bonded input supplies warehouses.

 If input supplies imported under the bonded input supplies warehouse scheme is not delivered to a producer within one year of being transferred into a bonded supplies input warehouse, the beneficiary shall, in addition to the duty payable on the input supplies, be required to pay 50% of the duty; provided, however, that Ethiopian Customs Commission may extend such period by one additional year taking into consideration the nature of the input supplies. Producer exporters and indirect producer exporters who are beneficiaries of the voucher scheme may buy inputs from a bonded input supplies warehouse by causing to be recorded on the voucher book the amount of duty payable on the inputs.

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