The RoSCTL (Rebate of State and Central Taxes
and Levies) scheme is an initiative by the Government of India to support the
textile sector. Here’s a comprehensive overview:
Objective: The RoSCTL scheme aims to reimburse the
embedded taxes and levies (both State and Central) that are not refunded under
other schemes, ensuring that exported products are globally competitive by
making them tax-free.
Scope: The scheme primarily focuses on the apparel
and made-up sectors. It covers various textile products including garments and
made-up articles like bed linens, curtains, cushion covers, etc.
Key Features:
1. Rebate
Components:
·
State Taxes and
Levies:These include VAT on fuel used in transportation, captive power, mandi
tax, electricity duty, and other levies on agricultural inputs.
·
Central Taxes and
Levies: These cover Central Excise duty on fuel, coal, etc., used in the
production process.
2.
Eligibility:
- Exporters of garments and
made-ups.
- Products should be manufactured
in India.
- The scheme covers exports made
from March 7, 2019, onwards.
3. Rebate Rates:
- The rebate rates under the
scheme vary based on the product category and the type of input. Detailed rate
schedules are notified by the government and are updated periodically.
4.
Transferability:
·
The scrips (rebate
instruments) issued under the RoSCTL scheme are transferable. Exporters can
sell these scrips to other importers for cash.
5.
Implementation:
·
The scheme is
implemented through the Directorate General of Foreign Trade (DGFT) and
involves the issuance of rebate scrips that can be used to pay various duties
and taxes.
Benefits:
1.
Cost Competitiveness:
·
By rebating the
unrefunded taxes and levies, the scheme helps in reducing the overall cost of
production, making Indian textiles more competitive in the global market.
2.
Encouragement to Exports:
·
The scheme
incentivizes exporters, thereby promoting higher exports and contributing to
the overall growth of the textile sector.
3.
Job Creation:
·
By boosting the
textile industry, the scheme indirectly supports job creation, especially in
rural and semi-urban areas where textile manufacturing units are often located.
Application Process:
1.
Registration:
·
Exporters need to
register with the DGFT and obtain an Importer Exporter Code (IEC).
2.
Claim Submission:
·
After the export
consignment is shipped, exporters need to file their rebate claims
electronically through the DGFT portal.
3.
Issuance of Scrips:
·
Once the claims are
verified, the DGFT issues rebate scrips to the exporters.
4.
Utilization/Transfer:
·
These scrips can be
utilized to pay customs duties or can be transferred to other importers.
Recent
Developments:
·
The scheme has been
extended multiple times, with the latest extension ensuring its applicability
until March 31, 2024.
·
The government is
continuously reviewing and updating the rebate rates to reflect changes in tax
structures and input costs.
Comparison
with Other Schemes
·
MEIS (Merchandise Exports from India Scheme): Unlike RoSCTL, which is specific to the
textile sector, MEIS is a broader scheme covering various sectors. RoSCTL
provides rebates on taxes not covered by MEIS.
·
RoDTEP (Remission of Duties and Taxes on Exported
Products): This is a newer
scheme intended to replace MEIS and covers a wider range of sectors, including
textiles. RoSCTL continues to operate alongside RoDTEP for the textile sector.
Challenges
and Criticisms
·
Complexity in Implementation: Ensuring accurate calculation and timely
reimbursement can be complex and may require robust monitoring.
·
Overlapping with Other Schemes: There are concerns about overlap with schemes
like RoDTEP, which might lead to confusion among exporters.
Conclusion: The RoSCTL scheme is a significant step
towards promoting textile exports by mitigating the cost disadvantage caused by
various embedded taxes and levies. By understanding the scheme's features,
benefits, and application process, textile exporters can effectively leverage
it to enhance their competitiveness in the global market.
Disclaimer: All the Information is based on the notification, circular
and order issued by the Govt. authority and judgement delivered by the
court or the authority information is strictly for educational purposes and on the
basis of our best understanding of laws & not binding on anyone.
