The recent changes in rates of Merchandise Exports from India (‘MEIS’) Scheme for certain goods. The Central Government provided an additional 2 percent MEIS benefit on certain goods as per its various Public Notices[1].

As per Public Notice No. 47/2015 -2020 dated December 7, 2019, (‘Public Notice 47’), additional benefit of 2 percent shall not be available effective January 1, 2020 except for goods specified in Annexure to Public Notice 47.

Consequently, additional 2 percent benefit under MEIS Scheme for all sectors (except garments and made ups) would end on December 31, 2019. Resultantly, the original MEIS benefit of 2, 3 and 5 percent would continue to be available for such products.

NITYA Comments: This change is likely to have an adverse impact on exports. The exporters taxpayers availing benefit under MEIS Scheme, need to factor in such reduced incentive while calculating cost or finalizing price of the export products.

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[1] Public Notice No. 44 dated December 5, 2017, Public Notice No. 2 dated May 1, 2018, Public Notice No. 13 dated June 6, 2018, Public Notice No. 28 dated August 8, 2018 and Public Notice No. 7 dated May 5, 2018