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What Is RoDTEP Scheme? Its Benefits, Requirements For Traders & Exporters

RoDTEP Scheme for Traders and Exporters

The RoDTEP scheme or Remission of Duties and Taxes on Exported Products, is a brand new scheme launched by the Government of India to facilitate exporters more efficiently. This scheme replaced the pre-existing MEIS scheme on January 1st, 2021, the day it was first announced via press.

The scheme’s main motive is to reimburse all exporters on taxes as well as duties that were previously non-reimbursable. This gives exporters new benefits for exporting goods and services outside the country of India and promotes international trade.

If you are an exporter or business owner yourself, it is necessary that you familiarize yourself with the scheme’s various features and aspects. In this article, we will do exactly that by finding out what the various benefits are, eligibility requirements and details of the RoDTEP scheme.

Benefits of the Important RoDTEP Scheme

There are various benefits of the crucial RoDTEP scheme that every international business owner and exporter should be aware about. These benefits are –

1. Refunding duties and taxes that were non-reimbursable before –

Under the scheme, all types of taxes and duties such as the Value added tax (VAT), Coal tax, CED, Mandi tax etc. are now liable to a complete reimbursement. All the products that once fell beneath the MEIS scheme and RoSTCL are presently well within the control and regulation of the new RoDTEP scheme. This allows exporters considerable financial strength and flexibility and gives them the ability as well as motive to export more and more items through the boundaries of the country.

Learn more about – How To File For GST Refund For Small Businesses And Exporters?

2. Electronic credit system that is fully automated

The refund for the exporters will be done via an electronic ledger through shiftable electronic credits. These electronic credits can then be regulated and controlled through the aforementioned electronic ledger and will be sent to exporters when they avail the scheme. The automation of the entire reimbursement process only helps the process to be more streamlined, smooth and seamless than an offline procedure full of papers.

Learn more about – Input Tax Credit (ITC) under GST – Who can claim and how to claim it?

3. Seamless verification and higher security through automation

Due to the creation of a fully automated digital scheme platform, procedures of the process occur at an increasingly faster rate than they would if they were done offline. All the verification and security checking of the documents provided on behalf of the exporters to the platform will be completed with the assistance through a regulated and secure IT firm that will verify integrity and efficiency throughout the process and ensure that transactions complete much faster and smoother than before.

4. Scheme for all sectors

All industrial sectors in India are covered under the scheme if they were to export their goods outside the country. A committee will see that the scheme is integrated in the structure of various industrial sectors out there, advise the various industries of the benefits of the scheme and guide them through the process so that they can seamlessly avail the scheme without any considerable problem. This is extremely beneficial for the industrial scene in India since it provides a chance for all of the industries in India to provide their resources to international countries.

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Requirements of the RoDTEP Scheme

There are certain strict requirements if you wish to avail the benefits of the new RoDTEP scheme. These eligibility requirements are –

  1. There is no eligibility requirement for industrial sectors. All industrial sectors in India who wish to export their goods can avail full benefits of this scheme and be granted full tax reimbursement. Sectors that work on manual labour intensively, in particular, are delivered a higher priority than other industrial sectors.
  2. To avail RoDTEP scheme, you can be either a manufacturer exporter or a merchant exporter and you will easily be able to enjoy the benefits. The scheme extends its eligibility to all traders who wish to export their goods and services.
  3. You don’t need to have a particular minimum turnover for your company or industry to avail the benefits of the scheme. Just being a manufacturer or a trader is more than sufficient.
  4. You cannot re-export products and their export will not be facilitated by this scheme under any circumstances.
  5. The most major and crucial requirement is that the products that are going to be exported, need to be manufactured and created in India. Only then can a manufacturer or trader be able to access the scheme for their products and goods.
  6. Even unique trading units such as SEZ and EO can be completely eligible for the benefits of the scheme if they wish to do so, on top of the benefits from other schemes.
  7. If an e-commerce platform exports their goods and products that have been manufactured in India through the help of courier services, they can even avail the benefits of the RoDTEP scheme without any additional charges or requirements.

Learn more about – What Is TCS On Sale Of Goods? TCS Section 260C Explained In Detail

Details of the RoDTEP Scheme

Now that you know about the various benefits and features of the RoDTEP scheme, let us talk about why the need for the RoDTEP scheme arises in the first place. In the recent World Trade convention organized by the WTO (World Trade Organization), the USA challenged India’s most major export subsidy schemes and claimed that they harmed the workers of America.

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The panel, consequently, ruled against India with the statement that India’s export subsidy schemes violated the fundamental provisions of the trade body’s norm and that they should be removed at once as immediately as possible. That is why the Indian government removed the MEIS scheme from its trade and exporting framework and replaced the scheme with the RoDTEP scheme, which ensured that the Indian trade system stayed WTO-compliant.

Availing the scheme is an extremely straightforward and simple process that is designed to facilitate ease of use for exporters. To avail RoDTEP scheme, all an exporter needs to do is make a claim for the scheme in their shipping bill by making a declaration for it beforehand. Then the claim is verified, processed and regulated by the Department of Customs. Once processed and verified, a ledger with all of the admissible amount would be created which the users at the portal can then easily access and also be refunded easily.

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