Restoration of benefits under the Remission of Duties and Taxes on Exported Products:
The Government of India has announced the restoration of benefits under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for exports made by Advance Authorization (AA) holders, Export-Oriented Units (EOUs), and units operating in Special Economic Zones (SEZs).
- It was introduced through an amendment to the Foreign Trade Policy 2015-20, and it became effective for exports starting January 1, 2021.
- The primary aim of this scheme is to offset the taxes and duties incurred on exported goods that wouldn’t otherwise be credited, reimbursed, or refunded in any way, and are integrated into the exported goods.
- It is designed to reimburse exporters for embedded duties, taxes, and levies that are not otherwise refunded under any other existing scheme.
- It is compliant with World Trade Organization (WTO) norms and is implemented via a comprehensive end-to-end digital platform to ensure transparency and efficiency.
- It was enforced to repeal and reduce taxes on exported products, thereby encouraging exports and increasing the number of exports in the country.
- The scheme will be administered by the Department of Revenue, Ministry of Finance.
- It replaced the Merchandise Export Incentive Scheme (MEIS), in response to the US challenging Indian export subsidies under the MEIS at the WTO.
- Tax reimbursement under RoDTEP Scheme:
- The Scheme provides a mechanism for reimbursement of taxes, duties, and levies, which are currently not being refunded under any other mechanism at the central, state, and local levels, but which are incurred by the export entities in the process of manufacture and distribution of exported products.
- This not only includes the direct cost incurred by the exporter but also the prior stage cumulative indirect taxes on goods.
