The Duty Entitlement Pass Book (DEPB) scheme for exporters is likely to be extended for a few months beyond its current termination date of September 30, it is learnt.
The apparent reason for the move is the Commerce Ministry asking for adequate time to formulate an alternative to this popular scheme, which covers more than half of India's export basket. According to the Ministry, the September 30 deadline is unrealistic, given that there are as many as 2,750 items under the DEPB scheme. Determining the appropriate drawback rates for all of them would require a lot of paperwork and adherence to procedures, it reasons.
Exporters estimate that the transition from DEPB to an alternative duty drawback would require 9-12 months. They want the scheme to continue till the introduction of Goods and Services Tax (GST).
DEPB, which costs some Rs 8,500 crore to the exchequer annually, was earlier scheduled to end on June 30. The replacement duty drawback scheme is expected to reduce the fiscal burden by Rs 4,500 crore.
Since its benefits are determined by the principle of averaging rather than actual tax content in the export product, DEPB runs afoul of the relevant WTO agreement.
No comments:
Post a Comment