Government working to help exporters deal with countervailing duty cases

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The government is creating a verification system for exporters under the RODTEP scheme to ensure they follow countervailing duty rules. This system will include officials from DGFT, DGTR, and DoR to investigate subsidy claims on Indian products.

Government working to help exporters deal with countervailing duty cases

New Delhi: The government is developing a verification system to help exporters handle countervailing duty cases related to the RODTEP scheme, an official said. This is crucial because the US and European Union have imposed anti-subsidy duties on some domestic products.

These countries examined products that included reimbursement for levies such as electricity duty, VAT on fuel, or APMC taxes under the Scheme for Remission of Duties and Taxes on Exported Products (RoDTEP).

The scheme complies with WTO (World Trade Organization) regulations. The duties were imposed on specific units because they failed to provide the required documents to the investigation authorities, according to an official.

The Indian Ministry of Commerce is assisting exporters in maintaining proper documentation for handling such cases.

“We will provide guidance notes from DGTR to units so they can furnish the necessary documents during investigations,” the official stated.

In addition to scrutinizing unit documents, investigation authorities verify whether the government conducts random checks on duty incidences.

“We are working on a joint verification mechanism involving DGFT, DGTR, and DoR officials to randomly verify certain units and maintain records,” the official explained.

This system aims to verify claims made under the RoDTEP scheme.

“If, for instance, we are reimbursing RoDTEP at 1.7%, we need periodic verification to ensure duty incidences do not fall below this rate,” the official clarified.

“We are establishing this verification system to maintain official records and ensure oversight of duty incidences,” the official added.

Before imposing countervailing or anti-subsidy duties (CVD), countries conduct detailed investigations on products they believe are subsidized for export. CVDs are only imposed if the importing country’s investigative agency determines the subsidized imports are harming domestic industries.

These duties do not restrict imports but are intended to create a fair playing field for domestic players, as permitted by the WTO.

The US and the European Commission have conducted such investigations on Indian products like paper file folders, common alloy aluminium sheet, and forged steel fluid end blocks. During these investigations, the Indian government and affected exporters vigorously defended against subsidy allegations related to various government programs and schemes.

The RoDTEP scheme, effective from January 2021, aims to refund taxes, duties, and levies not refunded under other mechanisms at central, state, and local levels, incurred during the manufacturing and distribution of exported products.

This scheme is managed by the Central Board of Indirect Taxes and Customs (CBIC) in an end-to-end IT environment.

 

 

 

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