Cabinet approves scheme to rebate embedded taxes


The Union Cabinet chaired by Prime Minister Narendra Modi has approved the Scheme to Rebate State and Central Embedded Taxes to Support the Textile Sector. This will enable the government to take various measures for making exports of apparel and made-ups zero rated, thereby boosting India’s competitiveness and ensuring growth of the domestic industry.
At present, apparel and made-ups segments are supported under the Scheme for Rebate of State Levies (RoSL). However, certain state as well as Central taxes continue to be present in the cost of exports. The latest Cabinet decision provides for a scheme to rebate all embedded state and Central taxes/levies for apparel and made-ups which have a combined share of around 56 per cent in India’s textile export basket. Rebate of taxes/levies has been permitted through an IT-driven scrip system at notified rates, according to an official statement.

The proposed measures are expected to make the textile sector competitive. Rebate of all embedded state and Central taxes/levies for apparel and made-ups segments would make exports zero-rated, thereby boosting India’s competitiveness in export markets and ensure equitable and inclusive growth of textile and apparel sector, the statement said.

“The proposed rates of RoSL has come at a right time and would benefit the garmenting and made-ups segments. This would also increase the demand from the downstream sector and thereby strengthen the entire cotton textiles value chain,” The Southern India Mills’ Association (SIMA) chairman P Nataraj said.

Categories: Apparel, Asia, Business, India, Textile

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