The government on Monday extended the benefits of tax refund scheme –Remission of Duties and Taxes on Exported Products (RoDTEP) — to Export Oriented Units (EoU), Advance Authorisations (AA) holders and units in Special Economic Zones (SEZs).
The benefits of the scheme to the EoU, SEZ and AAs will be applicable from June of this year, a notification by the Directorate General of Foreign Trade said. These categories of exporters have been brought under the scheme after a gap of six months.
RoDTEP for SEZs, EoUs and AAs had expired on December 31,2024 and since then exporters had been seeking restoration of the benefits in view of the emerging world trade situation after the US President Donald Trump inaugurated a global tariff war.
The RoDTEP scheme is designed to refund duties, taxes and levies at the central, state and local level that get added to the cost of products meant for exports. It is a replacement for the Merchandise Exports from India scheme which along with other export promotion schemes were successfully challenged at the World Trade Organization by the US. The rate of refund ranges from from 0.3% to 3.9% of the value of product exported.,
The scheme, which was first introduced in 2021, covers exports of 10,642 products. It has seen many extensions and modifications since it was first introduced. It was last extended on September 30 last year for a year. However, for SEZs, EoUs and AAs the extension was only till 2024-end.
The incentive is paid in the form of transferable duty credit scrip which can be used to pay import duties or sold in the market by exporters. The RoDTEP scheme operates under a budgetary framework.
“The restoration of RoDTEP benefits to Advance Authorisation, EOU and SEZ exporters will not only ensure level playing field for these entities but also boost price competitiveness of their products in international markets. This is a vital support at a time when Indian exporters are navigating intense global competition and demand uncertainties. It will certainly help in pushing exports and improving India’s share in global trade,” President of Federation of Indian Export Organisations (FIEO) S C Ralhan.said.