New sops bill: Rs 1,000 crore

the additional revenue loss, mostly notional, due to the changes announced in the export promotion schemes in the exim policy is estimated to be less than rs 1,000 crore in the financial year 02-03, according to the director-general of foreign trade (dgft) mr l n lakhanpal. he, however, added that this was a very approximate figure as additional notional revenue loss was very difficult to estimate and may change with changes in the level of exports. he also added that all tax related changes had been cleared with the revenue department. revenue secretary dr s narayan, when contacted, said an estimate of additional revenue forgone was not immediately available. “we will be assessing the revenue loss’’, he said. he further said that sezs were a major concession but issues of revenue forgone would be relevant as and when the units start operations. earlier, answering questions after announcing the exim policy, the commerce minister murasoli maran justified the revenue sops for exports on the ground that giving tax rebates on indirect taxes was an international practice. he pointed out that if there are no exports there would be no imports of raw material for manufacturing them. he said that the idea was to export products not taxes. overall, duty forgone under various major export promotion schemes was estimated at rs 18,616.07 crore for april-december 01-02 as against rs 21,658.16 crore during 2000-01, according to official sources. since the difference between the two figures is three thousand crore odd, this may well have been bridged in the last three months of 2001-02. a full comparison would be possible only with full year figures. in fact, the estimated customs duty forgone for various export promotion schemes has increased for many schemes even during april to december, 2001-02 as compared to the whole of the previous financial year 00-01. the estimated customs duty forgone under the export promotion zone scheme increased from rs 1,223.37 crore in 2000-01 to rs 1,781.09 crore during april -december 01-02. hundred per cent eous have notionally cost an estimated rs 3537.04 crore of revenue lost in 2000-01 and rs 3,056.42 crore during the first nine months of the fiscal 2001-02. the revenue forgone under the export promotion capital goods (epcg) scheme increased from rs 1513.17 crore during 2000-01 to rs 1521.81 crore during april-december, 01-02, itself. duty drawback, where there is actual cash outgo from the exchequer instead of a notional revenue loss as in the case of most other schemes, was rs 4188.89 crore in 00-01. in the first nine months of the financial year 01-02 the figure was rs 2489.69 crore indicating a sharp decline unless there is substantial addition to this in the last three months of the fiscal. in june 2001, the rates under duty drawback were cut sharply but again increased - partially rolling back the previous reduction—in october 2001. this decrease may be responsible for the decline in payout under duty drawback in the first nine months of 2001-02.