Relaxation in Export Promotion Capital Goods (EPCG) Scheme
Various procedures under the Export Promotion Capital Goods (EPCG) scheme have been relaxed by the commerce ministry so as to facilitate the ease of doing business and reduce compliance requirements. Under this scheme, the capital goods imports are allowed duty-free, subject to export laws.
- Under the scheme, the authorization holder or the exporter has to export the finished goods that are worth six times the actual duty that is saved in value terms over a period of six years.
- The EPCG scheme’s objective is to facilitate the import of capital goods so as to produce quality goods and services and enhance the manufacturing competitiveness of the country.
The changes made to the scheme include those that are related to the annual reporting of export obligations which is the exporters can file it by 30th June annually instead of by 30th April each year, but any delay will attract a Rs 5,000 late fee. Any requests for the extension of export obligation have to be made within six months of expiry instead of 90 days as was the case earlier. However, applications that will be made after six months and up to six years will attract a late fee of Rs 10,000 per authorization. Also, any requests for the extension of block-wise export obligation must be made within six months of expiry and any applications submitted after six months and up to six years will attract a Rs 10,000 late fee per authorization. Any applications that are submitted after six years will be attracting a Rs 5000 per year fee. Earlier, there was no specified time limit which led to various discretionary interpretations. Along with this, the facility of paying customs duty through scrips (RoDTEP/ MEIS/RoSCTL) for default under the EPCG scheme has been withdrawn.
Category: Government Schemes Current Affairs