Cabinet approves new export incentive scheme – Remission of Duties and Taxes on Exported Products
The approval of new export incentive scheme viz. Remission of Duties and Taxes on Exported Products (‘RoDTEP’) by Union Cabinet on March 13, 2020.
The salient features of the Scheme, are as under:
- The Scheme will replace MEIS benefit. The incentive will be over and above duty drawback and GST refund;
- The Scheme will cover goods in a phased manner (tariff line / item wise);
- The incentive will be granted as a percentage of FOB value of export goods (like Duty Drawback and MEIS);
- The incentive will also reimburse taxes, duties and levies which presently become cost for the exporters like VAT on fuel, mandi tax, electricity duty etc; and
- The incentive will be granted as transferable duty / credit scrips in Electronic Ledger.
The Scheme has been introduced to counter WTO ruling which held MEIS benefit as violative of SCM Agreement. Notably, the Scheme is silent on other benefits to exporters like Advance Authorization / DFIA, EPCG, EOU and SEZ (which were also held as non-compliant to SCM Agreement). Hence, these benefits are likely to continue. Notably, the Government has not given any timeframe to implement this scheme.