India’s ministry of finance has turned down a proposal from its counterparts in the commerce ministry seeking a refund of duties paid in the course of export production in certain sectors including steel, government sources said on Thursday, November 24.
The sources said that the finance ministry has cited a shortage of funds to extend duty reimbursement for industries in steel, pharmaceuticals and chemicals, for duties paid for inputs that go into export production.
The commerce ministry had sought inclusion of these three sectors in the Reimbursement of Duties and Taxes on Export Production (RoDTEP) scheme.
Under the latter, various state and central taxes and levies imposed on inputs for export production are refunded to exporters in the form of transferable duty credits in electronic form.
Generally, the reimbursements range between 0.3 percent to 4.3 percent of the FOB-based value of exports based on a graded rating system.
The commerce ministry had justified inclusion of the steel sector in the RoDTEP since the industry had been eligible for a similar reimbursement under the Merchandise Export of India Scheme (MEIS), which has been discontinued.
Source: Steel Orbis