Remission of Duties and Taxes on Exported Products (RoDTEP)
Remission of Duties and Taxes on Exported Products (RoDTEP) is a new scheme launched by the government to replace the existing MEIS scheme for exports of goods from India. RoDTEP Scheme, to benefit the exporters in place of MEIS was announced vide press release dated 31-Dec-2020, w.e.f. 01-Jan-2021, to all export goods. Notifications from DGFT and MOF still awaited.
This scheme is going to give a boost to the domestic industry and Indian exports providing a level playing field for Indian producers in the International market so that domestic taxes/duties are not exported. Further, The Scheme will be implemented with end-to-end digitization.
The RoDTEP scheme would refund to exporters the embedded duties/taxes that were so far not being rebated/refunded. For example, VAT on fuel used in transportation, Mandi tax, Duty on electricity used during manufacturing etc. These would be covered for reimbursement under the RoDTEP Scheme. The rebate would be claimed as a percentage of the Freight on Board (FOB) value of exports.
An exporter desirous of availing the benefit of the RoDTEP scheme shall be required to declare his intention for each export item in the shipping bill or bill of export. The RoDTEP shall be allowed, subject to specified conditions and exclusions. However, the rates are yet to be announced however such rates to be notified in future would be applicable from 01-Jan-2021.
Once the rates are notified, System would automatically calculate the RoDTEP amounts for all the items where RoDTEP was claimed. No changes in the claim will be allowed after filing of export general manifest.
Who is eligible for the scheme?
Broad provisions are as under:
Other Important Points:
“Shipping Bill filed under RoDTEP scheme if applicable to SEZ unit & and subject to such conditions as prescribed including the product coverage”
In case exports from SEZ are covered under the RoDTEP scheme, such exports may be taken into account under RoDTEP.
a. RODTEPY – If RoDTEP is availed
b. RODTEPN- if RoDTEP is not availed.
If RODTEPY is not specifically claimed in the Shipping Bill, no RoDTEP would accrue to the exporter.
Issues which need to be resolved by RoDTEP Advisory
Comparison between MEIS and RoDTEP
|Schema of Incentive||Additional Incentive on Exports of goods
apart from other refunds and drawbacks
available on undertaking the said exports.
|Refund of Indirect taxes on Inputs used in the manufacture of exported product which is not being currently reimbursed by any other existing schemes.|
|WTO Compliance||Non-Compliant with WTO trade norms||Compliant with WTO trade norms|
|Incentive Percentage||2% to 5% of FOB value of Exports.||Product-based % – [To be notified later]|
|Mode of Issuance||Issuance in the form of transferable scrips (Hard copy/ downloadable)||Issuance in the form of transferable duty credit/ electronic scrip which will be maintained in electronic ledger.|
As of now the users can log into their ICEGATE account and create the RoDTEP Credit Ledger Account, as scrip generation provision will be made functional on the issuance corresponding notification by the department and availability of the budget.
Annexure 1: ICEGATE has issued advisory to all users for registering at ICEGATE.
Annexure 2: Complete step-by-step guide for the user to create a RoDTEP credit ledger account, generate scrips and transfer the scrips to any other IEC. https://icegate.gov.in/Download/RoDTEP_Advisory-v3.0.pdf
Annexure 3: Implementation of RoDTEP Scheme in Customs Automated System –Declarations in
Shipping Bill and further processing:
https://icegate.gov.in/Download/RoDTEP_Advisory-v3.0.pdf (page 15-17)
Annexure 4: Declaration to be filed as part of shipping bill or bill of export for export of goods under RoDTEP scheme:
“I/We, in regard to my/our claim under RoDTEP scheme made in this Shipping Bill or Bill of Export, hereby declare that:
1. I/ We undertake to abide by the provisions, including conditions, restrictions, exclusions and time-limits as provided under RoDTEP scheme, and relevant notifications, regulations, etc., as amended from time to time.
2. Any claim made in this shipping bill or bill of export is not with respect to any duties or taxes or
levies which are exempted or remitted or credited under any other mechanism outside RoDTEP.
3. I/We undertake to preserve and make available relevant documents relating to the exported goods for the purposes of audit in the manner and for the time period prescribed in the Customs Audit Regulations, 2018.”
H&A Comment: The government has ignored the trillion-dollar service industry for the purpose of extending export benefits as the RoDTEP is made applicable only for export of goods and not services. Presently, there is no clarity on this aspect. Further, exports by EOU, Advance Authorisation, Jobbing, etc., are kept outside the scheme. The trade & industry could seek to make representation before the government for extending the benefit to even these group of exporters.
Disclaimer: This material and the information contained herein prepared by Hiregange & Associates is intended for clients and other Chartered Accountants to provide updates and is not an exhaustive treatment of such subject. We are not, by means of this material, rendering any professional advice or services. It should not be relied upon as the sole basis for any decision which may affect you or your business