Rebate of State and Central Taxes and Levies on export of apparel, garments & made-ups extended

Rebate of State and Central Taxes and Levies on export of apparel, garments & made-ups extended

New Delhi, July 15, 2021

The Union Cabinet on Wednesday gave its approval for the continuation of Rebate of State and Central Taxes and Levies (RoSCTL) on exports of Apparel, Garments and Made-ups in exclusion from Remission of Duties and Taxes on Exported Products (RoDTEP) scheme.

The scheme will continue till March 31, 2024, an official press release said.

The other textiles products (excluding Chapters-61, 62 & 63) which are not covered under the RoSCTL shall be eligible to avail the benefits, under RoDTEP along with other products as finalised by the Department of Commerce from the dates which shall be notified in this regard, an official press release said.

Continuation of RoSCTL for Apparel/Garments and Made-ups is expected to make these products globally competitive by rebating all embedded taxes/levies which are currently not being rebated under any other mechanism. It will ensure a stable and predictable policy regime and provide a level playing field to Indian textiles exporters, the release said.

"It is a globally accepted principle that taxes and duties should not be exported, to enable a level playing field in the international market for the exporters. In addition to import duties and GST which are generally refunded, various other taxes/duties are levied by Central, State and Local Governments that are not refunded to the exporters.

"These taxes and levies get embedded in the price of the ultimate product being exported. Such embedded taxes and levies increase the price of Indian apparel and made-ups and make it difficult for them to compete in the international market," the release said.

Realizing the importance of refund of embedded taxes, cesses and duties, the Ministry of Textiles first launched a scheme by the name of Rebate of State Levies (ROSL) in 2016. In this scheme, the exporters of apparel, garment and made-ups were refunded embedded taxes and levies through the budget of the Ministry of Textiles.

In 2019, the Ministry notified a new scheme by the name Rebate of State and Central Taxes and Levies (RoSCTL). Under this scheme, the exporters are issued a Duty Credit Scrip for the value of embedded taxes and levies contained in the exported product. Exporters can use this scrip to pay basic Customs duty for the import of equipment, machinery or any other input.

Just one year after the launch of RoSCTL the COVID-19 pandemic set in and it has been felt that there is a need to provide some stable policy regime for the exporters. In the textiles industry, the buyer places long term orders and exporters have to chalk out their activities well in advance necessitating a stable policy regime. Thus, the Ministry decided to continue RoSCTL up to March 31, 2024, independently as a separate scheme, the release added.


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