After RoDTEP, govt likely to extend export-boosting textile scheme

Ministry seeks Cabinet's approval regarding RoSCTL scheme

After Remission of Duties and Taxes on Exported Products (RoDTEP), the government may extend the tenure of another export-boosting scheme that mainly seeks to benefit the textiles sector till 2025-26, people aware of the matter said.

The Rebate of State and Central Levies and Taxes (RoSCTL) scheme was launched more than four years ago to increase the 

competitiveness of apparel/garments as well as the home-furnishing space. 
 

The scheme is valid till March 31, 2024.
 

The textiles ministry has already sought the Union Cabinet’s approval regarding the same, as it received representations from the industry. “We are going for the extension of RoSCTL. The idea is to make it coterminous with the current finance commission cycle (till 2026),” one of the people cited above told Business Standard. 
 

“A Cabinet note has been moved for [this] purpose,” the person cited above said. “At the end of financial year 2025-26, the idea is that the Centre will take a call on whether to merge the RoDTEP and RoSCTL, which was a commitment made earlier,” he said.
 

An extension of the scheme’s tenure can help exporters who are grappling with tepid external demand. 
 

Such an export-boosting scheme can also help in the creation of employement opportunities.
 

Under the RoSCTL scheme, exporters get a refund of all embedded taxes/levies that are currently not being rebated under any other mechanism. 
 

Exporters are issued a duty credit scrip for the value of embedded taxes and levies contained in exported products. 

Exporters can use this scrip to pay tax while importing equipment and machinery.
 

With the rollout of goods and services tax (GST) in 2017, the Rebate of State Levies (RoSL) scheme was replaced by RoSCTL in March 2019.
 

Exporters had earlier said the benefit of RoSCTL, along with free trade agreements (FTAs) for India’s key trading partners, could be a game changer for Indian apparel and made-ups sectors. It could also  help in achieving the country’s rightful share in the global trade, they had said.

The scheme
 

> Exporters get refund of all embedded taxes/levies which 

are not being rebated under any other mechanism 

> They are issued duty credit scrip for the value of embedded taxes/levies contained in 

exported products 

> They use the scrip to pay tax while importing equipment, machinery

> Scheme aims increasing competitiveness of the apparel/garments and home furnishing space