Categories: Indirect Tax

Remission of Duties & Taxes on Export Product Scheme-RoDTEP

Remission of Duties & Taxes on Export Products Scheme (RoDTEP)

Introduction:

On 14 September 2019, the Government of India (GOI) announced the Remission of Duties and Taxes on Exported Goods (RoDTEP) scheme to replace the existing Merchandise Exports from India Scheme (MEIS) and establish a completely automated GST Input Tax Credit (ITC) path to nicely boost India’s exports. It was initially to be announced from April 2020 onwards, however, agreed to continue to allow the benefit until 31.12.2020 under MEIS & RoSCTL. Therefore, with effect from 1 January 2021, the value of the scheme on all export goods has been extended.

The scheme includes all industry sectors, including textiles. This scheme offers for the rebate of duties and taxes that were not earlier provided, such as local taxes, coal cessation, mandi duty, electricity duties, and transportation fuel. However, the rebate programme only allows for exports of goods, while the rebate for services would be covered under the current SEIS scheme (Service Export from India Scheme).

Key Features of Remission of Duties & Taxes on Export Products Scheme (RoDTEP) :

  • Tax/Duties/Levies Remission

The reimbursement of duties and taxes (like VAT, mandi fee,  and central fuel excise, etc.) imposed at central, state and local level is protected by RoDTEP and is not offered to refund by any other scheme. In addition, elements currently protected by the MEIS and RoSCTL schemes will be transferred to the scheme for RoDTEP.

More read : GST Return compliances calendar- Nov 2020

  • An automated method for refunds

Reimbursement will be issued to exporters in line with Digital India in the form of transferable duty credits and electronic scripts that are maintained in a digital ledger.

  • Speedy clearance by digitalisation

A monitoring and audit system with a risk management system focused on information technology will be placed in order to physically check the exporters’ records. This will enable rapid digital platform clearance.

  • Scheme for all sectors

RoDTEP includes all sectors, including the textile industry. Furthermore, the sequence of implementation of the scheme across sectors, prioritisation of sectors and the degree of benefit to be provided to different products shall be determined by the dedicated committee.

Key benefits of Remission of Duties & Taxes on Export Products Scheme (RoDTEP) :

www.carajput.com; New Measures of Boost Export
  • The RoDTEP scheme, being a WTO member and in accordance with WTO trade standards, will provide a seamless flow of government economic benefits.
  • Increasing competition in international markets would be introduced with guaranteed duty benefits by GOI.
  • Some taxes, like state taxes on energy, oil, water, and education, are not included in the existing schemes. Under RoDTEP, it is also stated that these taxes be included in the indicative list keeping the scheme exhaustive.
  • It will enable exporters to meet international standards and boost market growth by being more consistent and open with WTO standards.
  • Tax assessment for exporters has become fully automatic. Through an automatic refund route, companies can get access to faster GST refunds.

How to Claim the Benefits of Remission of Duties & Taxes on Export Products Scheme (RoDTEP)

in the present situation, users can log into their ICEGATE account & make a the RoDEP Credit Ledger A/c, as scrip creation provision will be made functional on the issuance corresponding notification by the department and availability of the budget. Implementation of the scheme in Custom Automated System has been developed.

  • The first aspect that an exporter needs to do is declare his intention to take benefit of the scheme on the shipping bill or export bill.
  • Customs will be processed once the EGM (Export General Manifesto) has been filled in.
  • Once a scroll with all individual shipping bills for the admissible sum was collected, it would be generated and made available at ICEGATE in the user account.
  • Under the Credit Ledger tab, users can build a RoDTEP credit ledger account. IECs who have registered with a DSC on ICEGATE may do this.
  • After selecting the relevant shipping bills, the exporter may log in to its account and generate a scrip.
  • In the bill of entries license table, the details of the scripts used for paying a fundamental custom duty will be registered.

Exporters cannot be denied Merchandise Export from India Scheme (MEIS) incentive due to technical error in the GST Online filling System

  • Hon’ble Madras High Court held that, due to technical error or lacunae in the exporters, electronic system cannot be deprived of the incentive or benefit given under the Merchandise Export from India Scheme (“MEIS”). (Gupta Hair Products Pvt Ltd. V Additional Director General of Foreign Trade [W.P.No.25860 of 2021 dated July 7, 2022])

Conclusion:

In the present Covid-19 Pandemic, where export growth is declining and industries are already facing uncertainty and decline, the government must support export-oriented industries so that they can survive. Only such incentives are available for Indian exporters to tap into the international market under the current RoDTEP scheme. The efficient and effective implementation of RoDTEP will greatly enhance the current expectations of the export industry which have been different.

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Rajput Jain & Associates is a Chartered Accountants firm, with it's headquarter situated at New Delhi (the capital of India). The firm has been set up by a group of young, enthusiastic, highly skilled and motivated professionals who have taken experience from top consulting firms and are extensively experienced in their chosen fields has providing a wide array of Accounting, Auditing, Taxation, Assurance and Business advisory services to various clients and their stakeholders. Rajput jain & Associates, a professional firm, offers its clients a full range of services, To serve better and to bring bucket of services under one roof, the firm has merged with it various Chartered Accountancy firms pioneer in diversified fields. We have associates all over India in big cities. All our offices are well equipped with latest technological support with updated reference materials. We have a large team of professionals other than our Core Team members to meet the requirements of our prospective clients including the existing ones. However, considering our commitment towards high quality services to our clients, our team keeps on growing with more and more associates having strong professional background with good exposure in the related areas of responsibility.

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