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Suppliers across the world and Importers in India are almost always concerned about the additional costs they have to bear in the guise of customs duties and taxes which are mandated on importing and/or exporting anything to/from India. If you have been paying hefty customs duties on your imports so far, you must learn about the ree trade warehousing zones in India.
What is a Free Trade Zone Warehouse?
Free Trade Zones, also called Foreign Trade Zones, are areas within the territory of a country but designated as a foreign territory. These zones are uniquely designed units intended to allow hassle-free import-export of goods. Activities that are allowed inside these zones include storage, warehousing, kitting, assembling, re-exporting, repackaging, labeling, etc. All these activities have minimal customs involvement as long as the goods are inside the FTZs. You need to pay duty only when you move your shipment or part of the shipment out of the FTZ for the Domestic Tariff Area (DTA) sale.
If required ownership of the goods stored inside these zones can be transferred as many times as you want with no need to take the goods out of the free trade zones. Since the foreign/free trade warehousing zones are deemed not within the territory of the country and are considered foreign territories/warehouses/ports for warehousing and other permitted activities these zones allow merchants to defer duties and taxes that otherwise are paid upfront.
The free trade zones can hold goods on behalf of domestic buyers and foreign suppliers. As long as your merchandise is stored inside these free trade zones, there is no need to worry about customs duty, taxes, detention, demurrage, or compliances.
What are the Key Benefits of using Free Trade Warehousing Zones for Importers?
The reasons and benefits that attract most merchants to the free trade zone warehouses in India include the following:
- Flexible end-distribution anywhere in India
- Deferred duty (which means your working capital is free and you can boost your sales as well)
- Quality control before paying the duty
- GST exemption on purchases and all services for FTZ operations
- Minimum buffer stocks
- Ability to carry out foreign exchange transactions
- Temperature controlled and Cold storage warehousing units for stocking medicines, food items, and other temperature-sensitive items
Do you want to use your working capital for more important purposes than just paying upfront customs duty and taxes on your imports even when they are stored and not being sold? With free trade warehousing zones, you can enjoy duty deferment with a plethora of other benefits. The money you save this way can be used for promoting and growing your business till the time you don’t move the goods out of the FTZs for selling in the local markets.
To learn more about OSV free trade zone warehouse and third-party logistics services, you may speak to the experts at the company.