The commerce ministry has released details of a new scheme to help exporters stay competitive and increase exports, at a time global demand for Indian goods has risen due to revival in economic activities in the developed economies. Mint looks at the blueprint:
NEW DELHI: In order to support the exports further, the government on Tuesday announced new export refund rates under RoDTEP scheme where exporters will be given tax refunds in the range of 0.5-4.3% on 8,555 products. The announcement of the rates, which are in the range of 0.5-4.3%, comes two years after the scheme was first announced. After that it had missed several deadlines.
“The scheme’s objective is to refund, currently un-refunded duties/ taxes/ levies, at the central, state & local level, borne on the exported product, including prior stage cumulative indirect taxes on goods & services used in production of the exported product and such indirect Duties/ taxes/ levies in respect of distribution of exported products”, the commerce ministry said.
The scheme is loosely based on the principle that taxes and duties should not be exported, and taxes and levies borne on the exported products should be either exempted or remitted to exporters, the ministry added.
Applicable from january 1, 2021, the rates are aimed at making India’s exports more competitive in the global arena, at a time when exports have become the driving factor of economic recovery. A Sakthivel, President, FIEO, said that the much-awaited rates will help in easing the liquidity of the exporters, ensuring predictability and stability thus helping competitiveness of exports in long term.
The scheme will be implemented by customs through a simplified IT system and refund will be issued in the form of a transferable duty credit/ electronic scrip (e-scrip) which will be maintained by the Central Board of Indirect Taxes & Customs (CBIC).
Abhishek Jain, Tax Partner, EY, says, “The notification lists down several ineligible categories such as exports by advance authorisation holders, EOUs, SEZs, units set up under MOOWR scheme; these industry players would be disappointed… The export industry would hope seamless transition into new scheme with equitable benefit.”
Source : https://www.newindianexpress.com/business/2021/aug/18/tax-refund-scheme-for-over-8000-export-items-2346290.html