DGFT Mandates Detailed Annual Returns For Major Rodtep Scheme Beneficiaries

(MENAFN- KNN India) New Delhi, Nov 4 (KNN)
Director General of Foreign Trade (DGFT) has introduced mandatory annual reporting requirements for exporters who have claimed duty credits exceeding Rs 1 crore under the Remission of Duties and Taxes on Export Products (RoDTEP) scheme.

The new directive has generated considerable discussion within the export community due to its extensive documentation requirements, reported BS.

The RoDTEP scheme, launched in 2021, was designed to reimburse exporters for various central, state, and local level taxes incurred during the production and distribution of exported goods that were previously unrefunded through other mechanisms.

Under this framework, exporters receive duty credits calculated as a percentage of their Free on Board (FOB) export value, which can be utilised against basic customs duties on imports.

The newly mandated Annual Rodtep Return (ARR) has raised concerns among exporters due to its demanding data requirements.

The return calls for detailed product-wise information regarding Value Added Tax (VAT) and Excise Duty paid on both inbound and outbound transportation.

Industry participants argue that such granular data is practically impossible to obtain, as transport service providers typically only issue invoices for freight charges without breaking down fuel-related tax components.

The DGFT has set March 31, 2025, as the deadline for submitting 2023-24 data, with penalties for non-compliance including potential loss of Rodtep benefits.

Late submissions within three months can be rectified with a Rs 10,000 composition fee, while delays beyond this period will incur a Rs 20,000 fee.

Exporters must also declare that their Rodtep claims do not exceed actual tax incurrences, with the committee reserving the right to demand reimbursement of excess claims.

Industry sources suggest that this enhanced data collection effort may be linked to ongoing World Trade Organisation (WTO) discussions, where India faces challenges in demonstrating that the Rodtep scheme does not constitute a prohibited export subsidy.

However, the retrospective nature of the data requirements may pose significant challenges, as most exporters likely have not maintained such detailed records during the previous fiscal year.

(KNN Bureau)

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