Introduction
MOOWR helps companies reduce working capital blockage by deferring payment of customs duty and IGST. The actual savings depend on import value, duty rates and how long goods remain in bonded storage.
Upfront Tax Deferment
Under MOOWR, companies are not required to pay Basic Customs Duty, Social Welfare Surcharge or IGST at the time of import. This means the entire tax amount stays available as working capital.
Illustrative Saving
For example, if a company imports goods worth ₹5 crore with a total duty and IGST impact of 30 percent, the upfront tax would be ₹1.5 crore. Under MOOWR, this ₹1.5 crore is not paid immediately and can be used for business operations.
Effect of Holding Period
The longer goods remain in bonded status, the greater the benefit. If finished goods are exported, duty may never be paid, resulting in complete tax savings.
Capital Goods Impact
For capital goods, MOOWR allows deferment of duty over long periods, which significantly reduces initial capital investment pressure.
Interest Cost Savings
By avoiding upfront tax payment, companies also save on borrowing and interest costs, further improving cash flow.
Conclusion
MOOWR can save substantial working capital, ranging from lakhs to crores, depending on import volume and business model, making it a valuable scheme for eligible companies.
Learn more about MOOWR scheme at https://www.jparks.co/services/apply-for-moowr-scheme/
