RODTEP Scheme for Exporters: Benefits & Eligibility Explained

Remission of duties and taxes on exported products, RoDTEP is a scheme introduced by GOI on 1st of Jan 2021 to replace the MEIS scheme. The objective of RoDTEP was to remit hidden taxes on exported goods which wasn't covered under the MEIS scheme. The scheme provides rebates from all hidden taxes levied by the state and central govt. on the product during its manufacturing process.

Exporters of various products can take benefits of this scheme as now they don't have to bear these hidden taxes on the exported products. The scheme is expected to give a push to the Indian economy & make Indian products more competitive in the global market by reducing cost.

The RoDTEP (Remission of Duties and Taxes on Exported Products) Scheme provides a range of significant benefits aimed at increasing export competitiveness.

• Refunds for previously non-refundable duties & taxes: Mandi Tax, VAT coal cess Central Excise duty on fuel, etc. will be reimbursed under this specific scheme. All items that fall under the MEIS and the RoSTCL (Rebate of State and Central Taxes and Levies) are now in the aegis under RoDTEP Scheme.
• Automated credit system: Refunds will be delivered in the form of transferable electronic scrips. These obligation credits will be recorded and tracked using an electronic ledger.
• Quick verification through digitization: The adoption of the digital platform has greatly accelerated the approval process. The exporters' records would be verified using an IT-based risk management system to assure transaction processing speed and accuracy.
• Multi-sector scheme: RoDTEP covers all sectors, including textiles, to maintain uniformity across all areas. A specialized committee will also be formed to determine on the order in which the scheme would be implemented throughout the various sectors, the extent to which each industry will benefit, and other related issues.

Below are the eligibility criteria for RoDTEP scheme:

• The RoDTEP scheme expands its benefits to all sectors, including the textile sector. Industries with a strong focus on labor that already enjoy benefits under the MEIS Scheme will be prioritized.
• It is available to both exporters from manufacturers as well as trader exporters (traders).
• There isn't a particular minimum revenue requirement to be eligible in the RoDTEP. However, items designed for export are not eligible for this program.
• To qualify for benefits, the products that are exported must be sourced from India.
• Special Economic Zone Units and Export-Oriented Units can also be entitled to benefit from the advantages offered through this scheme.
• The RoDTEP scheme is also applicable to goods that are exported via the courier service using platforms for e-commerce.

Remission of duties and taxes on export products covers various export products under its umbrella. The products are clubbed under four categories.

• Category A:- Product under "A" category includes textiles, handicraft and agriculture products
• Category B:- These are the products with high employment generation potential such as gem and jewelry and marine products
• Category C:- it includes engineering goods, pharmaceuticals and chemical export
• Category D:- includes product having lower priority such as rubber, plastic and ceramics

The following categories and products are not eligible for discounts under the RoDTEP scheme:

• Exports of products initially imported for export purposes.
• Trans-shipments that are part of exports refer to products that originate from an unidentified third country but are routed through India.
• Exports have to be accompanied by a minimal cost for export or export duty
• Certain products are prohibited or restricted to export.
• The supply of goods made by units located in the Domestic Tariff Area (DTA) to Special Economic Zone (SEZ) or Free Trade and Warehousing Zone (FTWZ) units
• Deemed exports
• vii. Products manufactured by Export-Oriented Units (EOUs) in the Electronic Hardware Technology Park (EHTP) and Bio-Technology Park (BTP).
• Products that are created in part or entirely in a warehouse, such as Manufacturing and Other Operations in Warehouse (MOOWR).
• Goods manufactured or exported to fulfill export requirements under advance authorizations, Duty-Free Import Authorizations (DFIA) or Special Advance Authorizations that are provided within the context of a duty exemption scheme.
• Goods produced and exported through units licensed to be 100% Export-Oriented Units (EOUs).
• Goods exported or manufactured by units located in Free Trade Zones (FTZ), Export Processing Zones (EPZ), and Special Economic Zones (SEZ).
• Second-hand items are items used after the manufacturing process has been completed.

The RoDTEP scheme is a significant step towards boosting the efficiency of the Indian export industry. The scheme is expected to increase the competitiveness of Indian products in the global market and provide benefits to all sectors, with labor-intensive sectors given priority. The scheme is WTO compliant and provides rebates on hidden and direct taxes, giving a competitive advantage to exporters at the global level.