Finally, the long pending demand from the exporters for RoDTEP benefit to exports made by Advance Authorisation/DFIA holders, EOUs and SEZ Units has been met but with about 40% reduction in the rates for these categories. This is possibly because these units can get exemption from duty on fuel too. The fact however is that there are a handful of such exporters availing of that benefit.
On 8th March 2024, the DGFT issued Notification No. 70/2023 in this respect to elaborate on the amended provisions.
1. Sr. No. viii, x, xi and xii of Para 4.55 of FTP (concerning Ineligible Supplies/ Items/Categories under the Scheme for Remission of Duties & Taxes on Exported Products) has been deleted w.e.f 11.03.2024
2. Sr. No. vii of Para 4.54 has been amended to added the rates of RoDTEP notified under Appendix 4RE (for exports of goods manufactured by AA holders, EOUs and SEZ Units)
3. A New Para 4.59A has been added which allows RoDTEP on eligible items at the rates and per unit value cap as applicable under the new Appendix 4RE.
4. The benefit of RoDTEP for exports done by Advance Authorsation Holders(except deemed exports) and EOUs will be from 11.03.2024 till 30.09.2024 only.
5. The benefit of RoDTEP for exports done by SEZ units will be once IT Integration of SEZ units is done with ICEGATE System. This same is expected from 01.04.2024. The benefit will be available from date of implementation till 30.09.2024 only.
6. RoDTEP Rates for 25 HS Codes are revised to manage the budgetary outlay for RoDTEP benefits for export of goods manufactured by Advance Authorisation Holders, EOUs and SEZ Units.
7. The RoDTEP Scheme earlier extended in September 2023 till 30.06.2024 is now extended upto exports till 30.09.2024
However, MOOWR eligibility is still ineligible, don’t know why? Just to save some funds..
For those in need of further clarification or assistance, 9999957442 or email at info@andees.com.
More Products added in RoDTEP Scheme
| Chapters | No.Of Items | RoDTEP benefit |
| Chapter 28 | 325 | 0.8% – 2% |
| Chapter 29 | 896 | 0.8% – 2% |
| Chapter 30 | 224 | 0.5% – 1.7% |
| Chapter 73 | 360 | 0.5% – 1.6% |
Much Awaited RoDTEP rates are announced – Budgetary constraints clearly visible
DGFT office under the Ministry of Commerce has now notified the scheme guidelines along with the applicable rates under RoDTEP vide its notification No. 19/2015-20 dated 17th August 2021.
To see the announcement click notification. To see the rates click the Appendix.
After a gap of almost 9 months from the notification date and after much dilly-dallying, the Government finally announced the RoDTEP rates for export products today. The scheme is supposed to replace the erstwhile MEIS and needs to be WTO compliant as it covers only those duties and taxes on exports that are not neutralized through GST and drawback.
While the actual amount of unutilized duty components on the products is presumably much higher, the rates are much lower than expected and with several constraints and value caps. This is clearly because of the budgetary constraint of only about Rs. 17000 crores
The most notable categories that are ineligible are those exported under Duty Exemption Schemes, by EOUs and by SEZs and manufactured in the new MOOVR scheme. The fact remains that these items also suffer the same amount of un-neutralized duty like other exports. The duty exemption, EOUs and SEZs schemes usually only exempt the BCD and IGST portion of the duties and not others like excise duty, electricity duty etc. The Government appears to be aware of this fact and would probably include them in the near future.
The rates are announced on 8550 line items, the maximum being 4.3% on textile goods and the lowest being 0.01% on precious metals and other high-value items. However, there are value caps on the items wherever the rates are in excess of 1.5%. About 30% of items have got the rate of 1%. Marine products have got upto 2.5% while vegetables and fruits have got only 1.4%. Tobacco, Minerals, Chemicals, Pharma, Fertilizers have been completely omitted. The steel sector has also been omitted even though they suffer the most. They may still not complain, however, given the high international prices that they are enjoying currently. Copper has got 0.3% while aluminium and aluminium products have got 1.2% to 2.2%. The engineering industry would not be happy with only 0.5% – 1% with very few items at 2%. Interestingly, the railway sector has got 1.8% for many products, that too without value cap.
Some of the interesting observations by Andees team are as follows:
Overall, the Government appears to have done a fair job of allocating the benefit to a large sector of the industry given the budgetary constraint. We hope that in future these rates will be revised to reflect the actual duty and taxes suffered by the industry and more and more sectors would be covered along with exports made under Duty Exemption Schemes, EOUs, SEZs, bonded warehouses etc. who all suffer the hidden and unutilized duties.
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