India developing verification mechanism for tax refund scheme after anti-subsidy action by US, EU

The Finance Ministry and Commerce and Industry Ministry are collaborating to establish an institutional mechanism for verifying tax refunds provided to exporters under India’s RoDTEP scheme. This initiative aims to preempt countervailing duties imposed by major importing nations like the US and European Union. \r

The move follows recent CVDs imposed by these countries on Indian exports, questioning India's verification methods for RoDTEP rates. The US particularly seeks clarity on the legitimacy of rates determined by the GK Pillai Committee. The proposed verification mechanism will involve the Department of Revenue and Directorate General of Trade Remedies, ensuring thorough validation of RoDTEP rates to align with the duties paid by exporters. \r

The RoDTEP scheme, introduced in 2021 to replace MEIS, refunds various embedded taxes and duties to promote exports, with a significant budget allocation aimed at boosting key export sectors.