RoDTEP Scheme
Centre restores RoDTEP scheme for exporters
Context: In a significant move aimed at enhancing India’s export competitiveness, the government announced the reinstatement of the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for Advance Authorisation (AA) holders, Export-Oriented Units (EOUs), and Special Economic Zone (SEZ) units.
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- Launched in 2021, the RoDTEP scheme is designed to reimburse exporters for embedded taxes, duties, and levies that are not refunded through any other scheme.
- Although the scheme was available until February 5, 2025, its suspension had prompted strong advocacy from export industry stakeholders seeking its continuation.
About RoDTEP Scheme
- RoDTEP (Remission of Duties and Taxes on Exported Products) is a flagship scheme of the Government of India, operational since January 1, 2021, designed to boost the competitiveness of Indian exports by refunding previously non-recoverable embedded taxes and duties.
- RoDTEP replaced the earlier MEIS (Merchandise Exports from India Scheme) after the World Trade Organisation (WTO) ruled that India’s previous export subsidy schemes violated global trade norms.
- The scheme was introduced to ensure India’s compliance with WTO rules while continuing to support exporters.
Key Features
- Refund of Embedded Taxes: RoDTEP reimburses exporters for central, state, and local duties and taxes that are not refunded under any other mechanism.
- These include taxes on fuel, electricity duties, mandi tax, VAT, coal cess, and other local levies that get embedded in the cost of exported goods.
- Digital Processing: Claims and refunds are processed electronically through the ICEGATE portal, ensuring transparency and efficiency.
- E-Scrips: Exporters receive e-scrips as refunds, which are transferable and can be used to pay basic customs duty.
- Wide Coverage: The scheme covers a broad range of goods and sectors, including agriculture, textiles, and electronics.
- WTO Compliance: RoDTEP is designed to be WTO-compliant, focusing on remission rather than subsidy.
How the Scheme Works
- Exporters must declare their intention to claim RoDTEP in the shipping bill at the time of export.
- Once the export is completed and the Export General Manifest (EGM) is filed, customs processes the claim.
- Eligible refunds are credited as e-scrips to the exporter’s ledger account on ICEGATE, which can be used or transferred.
- The refund rates are notified by the government and vary by product and sector, reflecting the embedded tax incidence.
Eligibility
- All exporters registered with the Directorate General of Foreign Trade (DGFT) are eligible, provided their products fall under the government-notified eligible list.
- Exporters using e-commerce platforms are also eligible.
Benefits
- Reduces Export Costs: By refunding hidden taxes, RoDTEP lowers the overall cost of Indian exports, making them more competitive globally.
- Encourages Export Growth: The scheme is a key part of India’s strategy to increase export volumes and diversify export markets.
- Supports a Range of Sectors: Benefits are extended to various sectors, including small and medium enterprises.
RoDTEP is a crucial reform in India’s export policy framework, ensuring that Indian goods are not disadvantaged in global markets due to unrefunded domestic taxes. It provides a transparent, efficient, and WTO-compliant mechanism for supporting exporters, thereby strengthening India’s position in international trade.
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The Source’s Authority and Ownership of the Article is Claimed By THE STUDY IAS BY MANIKANT SINGH
