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Press Note on Meeting of SRTEPC Chairman with Hon’ble Minister of Finance and Hon’ble Textile Minister on 27th May, 2018 in New Delhi

Circular No.MR/CIR/1613                                                                                      May 29, 2018

To: Members of the Council

Sub: Press Note on Meeting of SRTEPC Chairman with Hon’ble Minister of Finance and Hon’ble Textile Minister on 27th May, 2018 in New Delhi

Dear Member,

We are glad to inform you that SRTEPC Chairman – Shri Sri Narain Aggarwal had a one to one Meeting with the Hon’ble Finance Minister, Shri Piyush Goyal and Hon’ble Textile Minister Smt Smriti Zubin Irani in New Delhi on 27th May, 2018 to apprise on GST matters and other Export related issues. The Meeting was also attended by representatives of other EPCs and SIMA.

Given here-below are the highlights of the Meeting :

(A)       Submission of Memorandum by SRTEPC to consider the following issues :

  • urgent payment of pending GST refunds;
  • urgent refund of ITC;
  • refund of IGST on capital goods;
  • reimbursement of central taxes not being reimbursed through ITC under GST;
  • request Drawback Committee to re-examine ROSL Scheme to increase the rate for MMF segment at least up to 5%;
  • include Yarn and Fabrics under ROSL Scheme;
  • extension of MEIS scheme up to 31.03.2019 by which WTO compatible scheme be formulated and increase the rate to 5% to all MMF yarns, fabrics & made-ups and
  • increase Effective Duty on Imports.

(B)       SRTEPC, Chairman explained to the Hon’ble Ministers on various segments of textiles and accumulation of ITC at various stages viz., Weaving, processing, embroidery and other value-added segments and how the Exports are quite expensive and requested to allow full refund of ITC.

 

(C)       After the discussion during the Meeting, the Hon'ble FM and HMOT indicated the following:

  • Visit of Hon'ble Finance Minister to all the affected small units from weaving, processing, embroidery and other value-added segments in case of refund of accumulated ITC so that they can submit their grievances before the Hon’ble Minister for taking suitable measures.
  • As regards refund of accumulated credit on Capital goods, it is informed that there was no such provision of refunding Excise duty/VAT earlier and asked for illustrations/earlier provisions.
  • Allowing refund of accumulated GST for weaving units hasn't been agreed to.
  • In case of rebate of duty on electricity levied by state governments, which works out to around Rs. 3/- per metre of fabric, the Government officers were asked to examine and process further.
  • Rebate of taxes on fuel levied by state governments which is about 0.66% will be examined for further consideration.
  • Regarding increase of Effective Duty on Imports, it is informed that the government will study the issue and thereafter recommend.
  • The pending government dues such as ROSL, IGST will be released soon; Finance Ministry would allocate necessary funds within 15 days; this would ease the financial stress. The request of Rebating of other components under ROSL such as taxes on fuel, stamp duty, electricity duty, local body taxes, etc. will be examined and referred to a Committee.
  • Expressed concerns over migration of investments to countries such as Ethiopia and Bangladesh as per the demands of the overseas customers to overcome tariff barriers and indicated taking firm steps to create level playing field and control cheaper imports.
  • Duty Drawback Committee will be mandated to recommend enhanced DBK rates and ROSL fully taking care of embedded taxes and State levies that are not subsumed under GST; Central Government would immediately decide the rates for blocked/embedded Central taxes and recommend to all the major textile manufacturing States to consider refunding the State levies through ROSL.
  • Steps would be taken to workout alternate Schemes/benefits in lieu of certain non-WTO compatible benefits like MEIS.
  • Exim Bank will be advised to work out on a Special Scheme for reducing the interest rate burden on exports (IES).

Members may please refer the Press Note issued by SRTEPC in this regard.

Thanking You,

Yours faithfully,

S. BALARAJU
EXECUTIVE DIRECTOR

 

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