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Wednesday, September 30, 2020

‘Cost of new export scheme to far exceed Niti estimate of Rs 10,000 crore/year’

Although Pillai refrained from offering a precise estimate of the allocation under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme, he said the committee’s intention is not to leave out any event that causes tax content in exports.

By: ENS Economic Bureau | New Delhi | August 24, 2020 3:01:22 am
Global MPI is an international measure of multidimensional poverty covering 107 developing countries. (File)

The outlay for a key scheme, under which exporters will be reimbursed for all embedded taxes paid on inputs consumed in outbound shipments, could be “much higher” than the Niti Aayog’s much-curtailed estimate of Rs 10,000 crore a year, GK Pillai, former commerce and home secretary, who now heads a panel to fix the refund rates, told FE.

Although Pillai refrained from offering a precise estimate of the allocation under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme, he said the committee’s intention is not to leave out any event that causes tax content in exports. All the imposts that are not subsumed by the goods and services tax (GST) will be built into the RoDTEP rates, in a potential relief for exporters battered by the pandemic.

The government had envisaged an annual allocation of about Rs 50,000 crore under the RoDTEP scheme to make exports zero-rated. This new scheme is to replace the extant Merchandise Export from India Scheme – under which exporters were granted benefits worth about Rs 45,000 crore in FY20 – from January 2021. —FE

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