RoDTEP: Centre evaluating feasibility of export benefits to SEZ, EOUs

The Centre is evaluating the financial feasibility of a proposal to extend export benefits under the popular export promotion scheme, Remission of Duties and Taxes on Exported Products (RoDTEP), to units in export-oriented units (EOUs) and special economic zones (SEZs), and would decide based on the funds available, official sources have said.

“Extending the RoDTEP scheme to SEZs and EOUs has been a long-standing demand of the industry. The DGFT is evaluating the proposal. But no decision has been taken yet. We are examining whether it will be financially possible to do so or not,” an official told businessline.

The RoDTEP scheme, which seeks to reimburse all input taxes that go into the manufacture of an exported item, was introduced for most sectors (over 8,500 products) from January 1, 2021, but it had excluded units in the SEZs and EOUs. Lack of adequate funds was one of the primary reasons for doing so, per the Government. The RoDTEP rates range between 0.3 per cent and 4.3 per cent.

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The SEZ division of the Commerce Department recently wrote internally to the Director General of Foreign Trade (DGFT) forwarding a request made by the Export Promotion Council for EOUs and SEZs (EPCES) earlier this month. It had requested that initially, the RoDTEP scheme could cover EOUs as they are available on the ICEGATE like the units outside the zones. Later, when systems got updated, SEZs, too, could be included, it proposed.

ICEGATE is the national portal of Indian Customs of Central Board of Indirect Taxes and Customs (CBIC) that provides e-filing services to the trade, cargo carriers, and other trading partners electronically.

“While the technical aspects of the matter can be taken care of, what is important to see is whether there are enough funds to cover additional sectors. If the DGFT thinks that it might be feasible to do so, it will forward its proposal to the Commerce and Industry Minister and a final call on the matter could be taken,” an industry source said.

“Even to cover exports from just the EOUs, and not the SEZs, an additional outlay of ₹600-700 crore may be needed and that is big money,” the source added.

In 2023-24, the outlay for RoDTEP was fixed at ₹15070 crore and in the current fiscal it is expected to be higher by 10 per cent. “Although in 2024-25 export growth is expected to be subdued, the additional funds that would be required to cover EOU exports are substantial and the proposal needs to be examined in details,” the official said.

• Also read: India’s exports rise 3.12% in Jan despite Red Sea crisis, global slowdown

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