The sequence of introduction of the scheme across sectors, prioritization of the sectors to be covered, degree of benefit to be given on various items within the rates set by the committee will be decided and notified by the Department of Commerce (DoC).MUMBAI: Aluminium Association of India (AAI) has approached the ministry of finance and the ministry of commerce and Industry to implement remission of duties or taxes on export products (RoDTEP) scheme, a move aimed to compete and substitute Chinese aluminium exports to major economies in the world.
“These duties and taxes should not be exported as such and should be remitted back to the domestic producers to encourage domestic value addition and export of finished products,”said AAI in a letter dated 24th June.
The body has requested the ministries to ensure remission of unrebated central & state duties & taxes which constitutes around 15% of aluminium production cost, and to enhance benefit under merchandise exports from India scheme (MEIS) from current 2% to 5% for all aluminium products till RoDTEP is implemented.
The cabinet approved RoDTEP scheme on 13th March, 2020. Under the scheme an inter-ministerial committee will be set up to determine the rates and items for which the reimbursement of taxes and duties would be provided.
The sequence of introduction of the scheme across sectors, prioritization of the sectors to be covered, degree of benefit to be given on various items within the rates set by the committee will be decided and notified by the Department of Commerce (DoC).
Data from the report by AAI shows that aluminium exports have contributed $ 5.7 billion to India’s Forex earning in FY-19, i.e. 1.7% of total Indian exports ($330 billion).
“To enhance exports and double Forex earnings to the tune of around $10 billion it is imperative to support the industry with adequate remission of unrebated duties and taxes under the RoDTEP Scheme as a priority Sector,” the aluminium body said in a letter.
As per AAI’s letter, the large aluminium producing countries like China, by way of various incentives and subsidies for raw materials, tax benefits, export tax incentives have better cost competitiveness.
“On the other hand, the Indian Aluminium industry is struggling with the incidence of huge burden of unrebated central & state taxes and duties, constituting around 15% of Aluminium production cost,” the letter said.
Source: indiatimes.com