The basics of RoDTEP Scheme

RoDTEP stands for Remission of Duties and Taxes on Exported Products. It is a benefit scheme for exporters.

Are you an exporter of Goods from India?

If YES, are you in the pharmaceuticals, chemical, steel, or textile industries?

If you are an exporter (around 8555 tariff items), but not in the above sectors, are you an eligible candidate to apply for the RoDTEP scheme benefits.

The objective of the Scheme – To make ZERO tax suffered Exports. While producing the goods, the companies would be paying tax on fuel (like diesel), tax on electricity, stamp duty, municipal tax, unclaimed Input GST, etc. which are adding to the cost of production. To free exports from all such tax burdens, this scheme has been introduced.

Quantum of Benefit – It is difficult to compute the actual taxes paid on all these counts and thus, the benefit under this Scheme is given as a percentage of Freight On Board (FOB means Ex-Factory Price + other costs of exports) or a fixed amount per unit of measurement as notified.  You can find the percentages based on the item code here https://content.dgft.gov.in/Website/dgftprod/d2eeb635-1227-469a-848c-496256397ff8/Appendix%204R%20as%20notified%20on%2017%20August%202021%20for%20DGFT%20Portal.pdf

How to apply? The detailed rules and procedure for applying are yet to be notified by the department. The benefits would be issued in the form of transferable scripts which could be redeemed for paying basic customs duty or the scripts can also be traded with some other party.

Who will not get the benefits?

  1. This Scheme is applicable only for the Export of Goods; Service providers are ineligible.
  2. Sectors like pharma, steel are not eligible
  3. Deemed exports, supplies to SEZ/FTWZ, products manufactured in EHTP and BTP, 100% EOU, goods exported against advance authorization, export to merchant exporter, and the list goes on

This shows a long list of people who are not entitled to Scheme Benefits.

The government is spending around Rs.12,000 Crores during this fiscal year.

To read more, http://www.balakrishnaandco.com/news-and-articles/27-all-about-rodtep-scheme

Hope this helps.

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About B E Kumar Prasad

B E Kumar Prasad
He is a Practicing Chartered Accountant in Bengaluru, India. He has 25+ years of experience in income tax, business setup, and NRI matters. He is also an Insolvency Professional and Registered Valuer (F&SA).Prasad welcomes your comments and questions. Please email him at [email protected]

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