Replacement for DEPB scheme on backburner
The much-delayed alternate to the Duty Entitlement Pass Book (DEPB) scheme is gradually turning into a stillborn child. The idea of reimbursing duties imposed by state governments has been rejected by the law ministry.
By G Ganapathy Subramaniam and MK Venu, TNN |
NEW DELHI: The much-delayed alternate to the Duty Entitlement Pass Book (DEPB) scheme is gradually turning into a stillborn child. The idea of reimbursing duties imposed by state governments has been rejected by the law ministry. The only way to do so is through a Constitutional amendment, the commerce & industry ministry has been informed.
The move could be another lease of life to the existing DEPB scheme. Commerce & industry minister Kamal Nath has said that the DEPB facility will not go till a alternate window is available to enable exporters to access duty-free inputs. Officials are finding that it is virtually impossible to convince state governments to bear the additional expenditure that may arise due to such reimbursements. This avenue was explored since this was the only way such reimbursements could be made without a constitutional amendment.
The plan to source resources for the new DEPB scheme from the divisible pool of taxes has also not been accepted, highly-placed sources said. Officials feel that a number of state governments will oppose this idea since their share from the divisible pool will not be commensurate with benefits exporters of these states may get.
The move could be another lease of life to the existing DEPB scheme. Commerce & industry minister Kamal Nath has said that the DEPB facility will not go till a alternate window is available to enable exporters to access duty-free inputs. Officials are finding that it is virtually impossible to convince state governments to bear the additional expenditure that may arise due to such reimbursements. This avenue was explored since this was the only way such reimbursements could be made without a constitutional amendment.
The plan to source resources for the new DEPB scheme from the divisible pool of taxes has also not been accepted, highly-placed sources said. Officials feel that a number of state governments will oppose this idea since their share from the divisible pool will not be commensurate with benefits exporters of these states may get.
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