New export sop scheme likely on Friday

New export sop scheme likely on Friday

New Delhi: Government is likely to unveil on Friday, a new scheme to replace the popular tax refund DEPB for exporters, which is ending on 30 September.

The government spends annually about 8,500 crore for reimbursing exporters on the taxes paid on import equivalent content of export products, under the Duty Entitlement Pass Book (DEPB) scheme. The main beneficiaries are engineering, automobile and chemicals sectors.

It is popular among the exporters due to its attractive rates and flexibility which are not available in the other refund mechanism - duty drawback.

The exporters have been building pressure that they should be allowed similar benefits even if the nomenclature of the DEPB is changed.

According to sources, the finance ministry has worked out a compromise between the attractive DEPB and not-so- attractive duty drawback.

The details of the scheme would be announced by finance secretary R S Gujral along with senior officials of the central board of excise and customs (CBEC).

Though exports have shown a remarkable performance, growing by 54.2% between April-August 2011 to $134.5 billion, there are concerns that the momentum may not be sustained in the wake of increasing economic problems in the US and Europe.