The government on Friday notified the RoSCTL scheme for textiles exporters and said the duty credit scrips under this support measure would be issued without insisting on realisation of the export proceeds.

       On July 14, the Cabinet approved the continuation of the Rebate of State and Central Taxes and Levies (RoSCTL) scheme under which garment exporters will continue to get a rebate on central and state taxes on their outward shipments till March 2024.

       The notification said the adequate safeguard mechanism would be put in place for effective monitoring of realisation of the export proceeds.

       "While the proposed scheme will be implemented on a revenue foregone basis, a budgetary control would be exercised through appropriate entries in the annual financial statement.

       "To ensure that expenditure under the scheme does not exceed the allocation amount in a particular financial year, the expenditure and liability shall be reviewed on a quarterly basis," it added.

       It said that for the purpose of audit and verification, the exporter would be required to keep records to substantiate their claims made under the scheme. And, the Central Board of Indirect Taxes and Customs (CBIC) would put a monitoring and audit mechanism, with an information technology-based risk management system (RMS), in place.

       The textiles ministry will conduct an annual impact analysis of the scheme.

       Rebate of state taxes and levies would include VAT on fuel used in transportation, mandi tax, duty of electricity, and stamp duty on export documents. They will also include embedded SGST and CSGT paid on inputs such as pesticides and fertilisers used in production of raw cotton, central excise duty on fuel used in transportation, embedded CGST and compensation cess on coal used in production of electricity.

       The scrips will be issued electronically on customs system. It will be used for payment of basic customs duty on import of goods. They are freely transferable.

       "Action under the Customs Act may be taken by the customs authorities for recovery of erroneous or excess paid RoSCTL. Further, the exporter is required to return any over-payment of rebate issued through the scrips arising from miscalculation," it said.

       Under the RoSCTL scheme, maximum rate of rebate for apparel was 6.05 per cent; while for made-ups, this was up to 8.2 per cent. Garments and made-ups segment such as home textiles products are covered under the scheme.

       Commenting on the latest decision, Apparel Export Promotion Council (AEPC) Chairman A Sakthivel said the extension will help exporters get rebate on all embedded taxes and make products globally competitive.

       Sakthivel, who is also the FIEO president, said this will help exporters effectively compete with countries such as Bangladesh, Vietnam, Myanmar, Cambodia, and Sri Lanka.

       "The longer stability in the rates till March 31, 2024, will attract further investment in these sectors, as manufacturers can plan their exports on a longer time horizon factoring the RoSCTL rates," he said.

       (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)