CBIC Expands Tax Incentives for Courier Exports, Boosting MSME Competitiveness

New Delhi, Sep 14 (KNN) In a move aimed at strengthening India's position in global e-commerce and bolstering exports from micro, small, and medium enterprises (MSMEs), the Central Board of Indirect Taxes and Customs (CBIC) has extended significant tax incentives for exports made through courier services.

The Finance Ministry announced on Friday that these changes, effective from September 12, will provide a level playing field for export growth via courier mode and enhance the competitiveness of MSME exporters. The new amendment expands export-related benefits under three key schemes.

The first scheme is the Duty Drawback Scheme, which offers refunds on duties paid for imported raw materials used in exported products. 

The second is the Remission of Duties and Taxes on Exported Products (RoDTEP), providing refunds for certain duties and taxes not covered under other mechanisms. 

The third scheme is the Rebate of State and Central Taxes and Levies (RoSCTL), aimed at boosting garment exports.

These changes have been implemented through amendments to the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010. 

Saurabh Agarwal, a tax partner at EY, noted that the revised regulations allow businesses greater flexibility in their supply chains by enabling the use of courier services for imports and exports related to these schemes.

The move aligns with the government's broader efforts to streamline India's e-commerce export ecosystem. 

The foreign trade policy of 2023 includes a dedicated chapter providing a framework for cross-border trade in goods and services in the digital economy, promoting e-commerce through various channels including courier, post, and e-commerce export hubs.

India's e-commerce sector has experienced exponential growth over the past decade, with promising projections for the future. In the fiscal year 2023, courier exports totaled Rs 7,995 crore, with e-commerce exports accounting for Rs 3,510 crore. 

The government anticipates these figures to rise significantly, driven by global trends and various initiatives supporting the e-commerce industry. Projections suggest that India's e-commerce exports could reach a staggering USD 400 billion by 2030.

This strategic move by the CBIC is expected to particularly benefit MSMEs, allowing them to compete more effectively in the global marketplace and contribute to India's growing share of international e-commerce trade. 

As the digital economy continues to evolve, such policy adjustments are crucial in positioning India as a major player in the global e-commerce landscape.

(KNN Bureau)