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Monday, 16 March 2020

Government approves RoDTEP much to the delight of apparel sector

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Textile and apparel industry has reacted positively as Cabinet approves scheme for Remission of Duties and Taxes on Exported Products (RoDTEP). It will make Indian exports cost competitive and create a level-playing field for exporters.

RoDTEP, a WTO-compliant scheme, will reimburse taxes/duties/levies at the central, state and local level, which are currently not being refunded.

Raja M. Shanmugham, President, Tirupur Exporters Association (TEA) shared that this approval is a great relief to the garment exporters. While noting down the existence of RoSCTL scheme till 31 March 2020, he believes that the rate would be announced soon.

Certain taxes/duties/levies, however, are outside GST, and are not refunded for exports, such as VAT on fuel used in transportation, Mandi tax, duty on electricity used during manufacturing, etc.

Under the scheme, an inter-ministerial committee will determine the rates and items for which the reimbursement of taxes and duties would be provided. In line with ‘Digital India’, refund under the scheme, in the form of transferable duty credit/electronic scrip, will be issued to the exporters, which will be maintained in an electronic ledger.

Various items will be shifted in a phased manner from existing scheme MEIS to RoDTEP with proper monitoring and audit mechanism.

The refunds under this scheme would be a step towards ‘zero-rating’ of exports, along with refunds such as drawback and IGST. This would lead to cost competitiveness of exported products in international markets and better employment opportunities in export-oriented manufacturing industries.

Source :- https://in.apparelresources.com/