Remission of Duties and Taxes on Exported Products Scheme

As a new Indian MSME exporter, you might be paying various hidden taxes and duties that increase the cost of your goods. Earlier, not all such costs were refundable, making it tougher for you to compete internationally. To address this, the Government of India implemented the RoDTEP Scheme, intending to refund all embedded indirect taxes that are not reimbursed via other mechanisms. This scheme ensures World Trade Organisation (WTO) compliance as it replaced the old Merchandise Exports from India Scheme (MEIS), which was found non-compliant with global trade rules.

What is the Remission of Duties and Taxes on Export Products Scheme?

The Remission of Duties and Taxes on Export Products Scheme was launched on 1st January 2021 by the Government of India. It is designed to boost exports by allowing you, an exporter, to get refunds for duties and taxes involved in manufacturing and distribution, which are not otherwise refunded. These refunds are granted as electronic scrips (e-scrips) that you can use to offset basic customs duty or transfer to other businesses.

Objectives of the RoDTEP Scheme

• To refund all embedded duties and taxes that are not being refunded under any other existing scheme.
• To make Indian exports more competitive globally.
• To bring India’s export incentives in line with WTO regulations.
• To reduce the tax burden on exported products, especially for MSMEs.

Key Features of the RoDTEP Scheme

• Applies to goods exported from India from 1 January 2021.
• The refund is provided as electronic scrips (e-scrips) available through the  Indian Customs Electronic Gateway Portal (ICEGATE).
• The scrips are transferable and can be used to pay basic customs duty on imports.
• The scheme reimburses taxes/duties like mandi tax, VAT, electricity duty, fuel tax, which were not previously refunded.
• The benefit is a duty credit, not a cash disbursement or loan.
• Your eligible exports need a declaration at the time of filing the shipping bill.

Financial Assistance Offered Under the Scheme

• The scheme provides you with a refund in the form of transferable electronic duty credit scrips, not cash.
• The refund rate for your product is calculated as a percentage of the FOB (Free on Board) value, typically ranging between 0.3% and 4.3% as per notifications.
• You can use these e-scrips to pay basic customs duty on your imports or transfer them to another business.

Eligibility Criteria for RoDTEP Scheme

Eligibility

As an MSME owner, you are eligible if:

• You are exporting goods from India on or after 1 January 2021.
• You have a valid Import Export Code (IEC).
• You use regular export channels and not Special Economic Zones (SEZs).
• You declare intent to claim RoDTEP for each export item in your shipping bill.
• You have not availed of any other specific duty drawback benefit for the same export consignment.

Non-eligibility

You are NOT eligible if:

• You operate from an SEZ or are an Export Oriented Unit (EOU).
• You avail benefits under other duty exemption/remission schemes for the same goods.
• Your goods are “deemed exports”.
• You are claiming MEIS, Advance Authorisation, or similar incentives for exported goods.
• Imported goods re-exported (without manufacture) are not eligible.

Documents Required  for RoDTEP Scheme

• Valid IEC (Import Export Code)
• Shipping bill with RoDTEP declaration
• Export invoices and supporting documents
• Bank account details linked to IEC
• Registration on the ICEGATE portal with a digital signature certificate (DSC)
• Any other documents as may be required by customs/CBIC.

How to Apply for the RoDTEP Scheme

Step 1: Register your business and IEC on the ICEGATE portal.

Step 2: Export your goods and file a shipping bill, ensuring you declare your intent to claim RoDTEP for each item.

Step 3: Customs verifies your claim based on the shipping bill and documents.

Step 4: On approval, an electronic duty credit (e-scrip) is generated and credited to your ICEGATE ledger account.

Step 5: Access your e-scrip on ICEGATE and use it to pay import customs duties or transfer it as required.

Benefits of the RoDTEP Scheme

• Reduces Export Costs
  By refunding previously unreimbursed hidden taxes and duties (like those on fuel and electricity), the RoDTEP Scheme lowers your overall export costs, making your products more price-competitive globally.
• Boosts MSME and Exporter Confidence
  As an MSME owner, you benefit from reduced cost disadvantages, helping your business compete internationally and boosting your confidence to invest and grow in exports.
• Ensures Transparency and Automation
  The scheme operates fully digitally via the ICEGATE portal, which automates claims, speeds up refunds, and allows you to track status transparently, reducing manual errors and paperwork.
• Expands Product and Sector Coverage
  RoDTEP benefits now cover over 10,795 product categories, including textiles, pharmaceuticals, chemicals, and agriculture, thus supporting a wider range of MSME exporters like you.
• Promotes Employment and Economic Growth
  By enhancing export opportunities in labour-intensive sectors, RoDTEP helps your business generate more jobs and contributes to India’s economic and industrial growth.
• WTO Compliant Support
  Since RoDTEP is designed in line with WTO norms, you can rely on its continuity and legitimacy, giving your exports stable and globally accepted incentives.
• Facilitates Easy Monetisation through E-Scrips
  You receive refunds as electronic duty credit scrips (e-scrips), which you can use to pay import duties or transfer to others, offering you flexibility and improved cash flow.

Real-World Examples of RoDTEP Application

• Textile exporters receiving refunds for embedded electricity and fuel taxes.
• Leather goods MSMEs using e-scrips to reduce input costs.
• Marine product exporters increasing global sales due to better pricing.

Related Government Support Plans with RoDTEP

Final Words

As an MSME owner, the RoDTEP Scheme offers you a transparent system to recover non-creditable taxes and duties, ensuring your exports remain globally competitive. Make sure to claim your benefit by following the correct process, maintaining all documents, and keeping abreast with official notifications.