Rebate of Duties & Taxes on Exported Products (RoDTEP Scheme):
RoDTEP intends to refund all previous taxes remaining under the export promotion scheme, including central and state taxes paid on fuel used in a transportation of goods on exports, electronic customs duties on production, an authorization levied by APMC, toll duty and stamp duty on import and export document etc. This scheme aims to support the Authorization to Operate Product (RoDTEP), which has been extended from 30 September 2023 until 30 June 2024 at the same rate as current exports. Consequently, this will help our exporting community negotiate export agreements on better terms in the current global environment. Furthermore, the program is WTO compliant and implemented in an end-to-end IT environment. Additionally, it is part of the broader framework of export incentives in India designed to bolster the country’s competitiveness in international markets.
Service Exports from India Scheme (SEIS):
The Service Exports from India Scheme’ (SEIS) seeks to encourage businesspeople who export listed services. Service exports are promoted because they generate foreign currency for the nation as well. The service exporters receive an incentive of 3-7% of the net foreign exchange revenues under SEIS. To be eligible for a claim under the system, service providers must have an active Import-Export Code (IEC Code) and minimum net foreign exchange profits of US$15,000. These incentives are a significant part of the export benefits in India, making the country a favorable environment for service exporters.
Duty Exemption/Remission Schemes:
Advance Authorization Scheme (AAS)
The Advance Authorisation Scheme enables traders to import raw materials duty-free for producing export goods. Import duties can be as low as 0% for raw materials used in manufacturing export products.
Duty-Free Import Authorisation (DFIA Scheme)
Similarly, the purpose of this scheme is the same as the Advance Authorization Scheme, i.e., to allow duty-free imports of raw materials. However, this scheme applies post-exports; it allows duty-free imports only after completing exports.
The Rebate on State & Central Taxes and Levies Scheme (RoSCTL Scheme):
The old RoSL scheme was replaced by the new RoSCTL scheme in 2019. The RoSCTL scheme is only applicable to the apparel and made-up industry, covering Chapters 61-63 of the ITC (HS).
It grants refunds on taxes such as VAT on transportation fuel, captive power, ‘mandi’ tax, and electricity duty. Soon, it will merge with the RoDTEP scheme across all sectors.
Export Promotion Capital Goods Scheme (EPCG Scheme :
EPCG scheme facilitates the imports of capital goods to produce goods and services by manufacturers. Under this scheme, exporters can partner with a manufacturer and import the required capital goods to produce export goods at 0% duty.
This scheme also helps reduce the service exporter’s capital costs. Service exporters such as hotels, travel & tour operators, taxi operators, logistics companies, and construction companies are some beneficiaries of this scheme.
Export Oriented Units (EOU):
In addition, the EOU scheme, introduced in 1981, aims to increase exports by creating a favorable ecosystem for companies that are 100% exporters. This scheme allows certain waivers and concessions in compliance and taxation matters.
Other schemes include:
GST Refund for Exporters:
- LUT Bond Scheme: Exporters can export goods without paying any GST by obtaining a Letter of Undertaking (LUT) bond.
- IGST Refund: Exporters can export goods on payments of Integrated GST and later, claim the refund for the same from the Customs Department.
- 1% GST Benefit for Merchant Exporters: Merchants can procure the export goods from domestic suppliers at 0.1% concessional GST rate.
Deemed Export Benefit Scheme:
In certain predetermined circumstances chosen by the government, this plan offers domestic manufacturers an equal playing field through deemed exports. In this type of transaction, items remain within the nation, and payment occurs in free foreign exchange or Indian rupees.
Star Export House/Status Holder Certificate:
Eligible exporters earn recognition under this program, acknowledging them as entrepreneurs who have effectively advanced India’s international trade. This recognition is based on the quantity and value of completed exports, earning them star ratings.
Holders who qualify enjoy perks such as expedited customs clearance, exemption from the requirement to negotiate documents through banks, waiver of the bank guarantee required for certain export promotion schemes, priority in the payment of import tariffs, and other privileges.
These initiatives are essential components of the export benefits in India, ensuring that Indian exporters can successfully penetrate and establish themselves in new international markets.
Market Access Initiative (MAI) Scheme:
The Market Access Initiative (MAI) plan, introduced in 2018, catalyzes export growth by identifying new markets. It provides funding for all export promotion initiatives in these markets. The goal of this program is to give qualifying organizations financial assistance so they can carry out market access initiatives.
These initiatives include marketing, market research, promotion, and branding in new countries. The program also covers the costs associated with complying with import laws. These initiatives are essential components of the export benefits in India, ensuring that Indian exporters can successfully penetrate and establish themselves in new international markets.
Interest Equalisation Scheme (IES):
Exporters can receive pre- and post-shipment export credits in Indian rupees from IES. This program offers 3% interest help to all exporters in the designated 416 tariff lines (extended system of HSN Codes) and 5% interest support to all manufacturers in the MSME sector.
The RBI and the participating banks work together to implement and oversee this program, under which the banks give the benefit of lower interest rates directly to exporters before receiving reimbursement from the RBI. This program, along with others, forms a crucial part of the export incentives in India, helping to maintain the competitiveness of Indian exporters on a global scale.
Leave a Reply