Part of: GS Prelims and GS-III- Economy; Import and Export
In news
The Central government has taken a decision to cap export incentives under Merchandise Exports from India Scheme (MEIS) at Rs. 2 crore per exporter on outbound shipments made during September-December, 2020.
Key takeaways
The ceiling would be subject to a downward revision to ensure that the total claim doesn’t exceed the allocated Rs. 5,000 crore for the period.
The new Import Export Code (IEC) obtained on or after 1st September will be ineligible to submit any MEIS claim for exports.
The Indian government has announced a new WTO-compliant scheme called Remission of Duties or Taxes On Export Product (RoDTEP) which will replace MEIS starting 1st January 2021.
Important value additions
Merchandise Exports from India Scheme (MEIS)
It was introduced in the Foreign Trade Policy (FTP) 2015-20
Objective: To offset infrastructural inefficiencies and associated costs involved in exporting goods/products which are produced /manufactured in India including products produced/manufactured by MSME Sector
Remission of Duties or Taxes On Export Product (RoDTEP)
The new scheme is implemented from 1st January 2020.
It creates a fully automated route for Input Tax Credit (ITC) in the GST to help increase exports in India.
It will reimburse all the taxes/duties/levies being charged at the Central/State/Local level which are not currently refunded under any of the existing schemes but are incurred at the manufacturing and distribution process.
The Ministry of Finance has set up a committee under the chairmanship of former commerce and home secretary GK Pillai to finalise the rates under RoDTEP.
