Service Exporters ask for 10% incentive under new scheme

A new incentive scheme is under development by the Services Export Promotion council for selective sectors, where the advantages for the export sector lie between 3% to 10%.

February 21, 2022

Contradicting the SEIS, the new incentive scheme provides duty credit scripts to exporters at 3% to 5%, varying on the amount of foreign exchange earned.

In the previous financial year, the government had released Rs. 10,002 crore to pay-off the pending services export dues.

A Duty Remission on Export of Services scheme was proposed by the council last year in order to refund taxes to service exporters

Higher sops increase the chances of competing with other countries providing services at a lower rate.

Hospitality, Aviation and Tourism sectors have been affected by the Covid-19 pandemic and  have proposed a 10% incentive rate, under a new scheme to replace the Services Export from India Scheme (SEIS)

A new incentive scheme is under development by the Services Export Promotion council for selective sectors, where the advantages for the export sector lie between 3% to 10%. Contradicting the SEIS, the new incentive scheme provides duty credit scripts to exporters at 3% to 5%, varying on the amount of foreign exchange earned. 

In the previous financial year, the government had released Rs. 10,002 crore to pay-off the pending services export dues. A Duty Remission on Export of Services scheme was proposed by the council last year in order to refund taxes to service exporters, small and micro exporters were eligible for 7% incentive while the large ones were eligible for 4% incentive from the Government. 

The higher the Standard Operating Procedures (SOPs), higher are the chances of the Indian service providers to compete against Philippines, Cambodia, East and South African countries as per the service standards. 

Last September, the government also imposed a limit on the total entitlement under the SEIS for shipments made during FY 19-20 at Rs. 5 crores per exporter after the proposal for higher SOPs was introduced.