Exporters air concern over 'inadequate' budget allocation to

Exporters on Wednesday expressedserious concern over the grossly inadequate budgetallocation to the tax refund scheme RoDTEP and disallowingIntegrated Goods and Services Tax IGST refunds, claimingthat these might adversely affect overall exports.The government had approved the Remission of Dutiesand Taxes on Exported Products RoDTEP scheme in March lastyear for reimbursement of taxes and duties to exporters, witha view to giving a boost to the countrys dwindling outboundshipments.The budget allocation is just Rs 13,000 crore for theRoDTEP scheme which is grossly inadequate.

Exporters on Wednesday expressedserious concern over the ''grossly inadequate'' budgetallocation to the tax refund scheme RoDTEP and disallowingIntegrated Goods and Services Tax (IGST) refunds, claimingthat these might adversely affect overall exports.

The government had approved the Remission of Dutiesand Taxes on Exported Products (RoDTEP) scheme in March lastyear for reimbursement of taxes and duties to exporters, witha view to giving a boost to the countrys dwindling outboundshipments.

''The budget allocation is just Rs 13,000 crore for theRoDTEP scheme which is grossly inadequate. This amount shouldhave been around Rs 50,000 crore,'' Federation of Indian ExportOrganisations (FIEO) Chairman (East) Sushil Patwari told PTI.

The rates for the new scheme have not been announcedby the government, but as the allocation is not adequate, itappears that the benefits will be much less than whatexporters used to get from the previous Merchandise Exportsfrom India Scheme (MEIS), he said.

''And it may have an impact on the competitiveness ofexporters and overall exports,'' Patwari said.

Any further delay in announcing rates for RoDTEP willhave serious implications for future exports as exporters arein ''wait and watch mood'' before finalising new contractsparticularly in sectors having thin margins, FIEO PresidentSharad Kumar Saraf had said on January 29.

RoDTEP replaces the existing MEIS and it aims atreimbursing taxes and duties incurred by exporters such aslocal taxes, coal cess, mandi tax, electricity duties and thefuel used for transportation, which are not getting exemptedor refunded under any other means.

Moreover, exporters said, they will no longer beallowed Integrated GST (IGST) refunds and will have to gothrough the Input Tax Credit (ITC) process which is a majorsetback for the industry reeling under crisis.

''Exporters are no longer eligible for IGST refunds andthey have to go through the ITC refund process. The GSTCouncil will allow class of persons and class of goods andservices to be eligible for IGST refund. (It is a) huge issuefor exporters,'' FIEO DG & CEO Ajay Sahai said.

Exporters said that unless the matter is reconsidered,their working capital requirement will jump.

IGST refunds are issued to exporters automaticallywithin a fortnight after filing of returns without any manualintervention. But, ITC is claimed only after paying tax andthe process for refund is complex compared to IGST mechanism,they said.