Rebate of State Levies (RoSL)

Government of India (GoI) has approved the Rebate of State Levies (RoSL) scheme to support the textile sector to boost increase the competitiveness among the global market and create new employment opportunities.

Outline of RoSL

In the year 2015, GoI implemented

Merchandise Exports from India (MEIS) and Service Exports from India (SEIS) through Foreign Trade Policy (FTP) to make the export products more productive and competitive among the international market. Since the MEIS scheme for garments and made-ups that offered 4 per cent support for the trade has become unavailable from December 31, GoI introduced Scheme to Rebate of State Levies (RoSL) and Central Embedded Taxes to support the textile sector. This scheme would also replace the pre-GST uniform RoSL rates and Central Taxes for the cost of exports. RoSL plays a vital role for the exporters by providing zero-rated taxation on apparel and made-up products. This scheme would enable the exporters to increase traffic, enhance competitiveness among the global market, and compete against countries such as Sri Lanka, Bangladesh, Cambodia and Vietnam, who enjoy zero taxation. This would also benefit the traders who export to the European Union (EU), India’s largest export market for the apparel sector, facing a tariff variation of 9.6 per cent. GoI has implemented the RoSL scheme on 7th March 2019 to March 31, 2020 through IT-driven Scrip System to prevent delay and ensure swift distribution of products. As apparel and made-ups contribute 56 per cent of the textile industry, implementing zero-rated taxation will boost the productivity and export intensity, leading to significant growth in India’s economy.

Objectives of the Scheme

To increase the export production of apparel and made-ups
To provide zero-rated export taxes for apparel and made-ups to compete against the global market
To ensure tax benefits are met to the trading and manufacturing sector for prompt disbursal of products
To minimise the purchase and manufacturing costs and increase sales and growth in the turnover
To increase manufacturing units and employment and
To promote quality process management and support for global marketing

The press release on the scheme is provided below:

PIB Notification on RoSL

Benefits of the Scheme

Rate of Central levies on apparel increased from 1.7 per cent to 6.05 per cent
Rate of Central levies on made-ups increased from 2.2 per cent to 8.2 per cent
Boosts the transition of business for small and medium garments manufacturers
Implementation of zero-rated tax helps to decreases the purchase value of the product and increases the profit margin for traders and manufacturers
Rebates offered by States to stamp duty, petroleum tax, electricity duty and mandi tax embedded in exports shall be extended to the textile industry
Increases the distribution and sales and helps to meet the demands of the versatile textile market

GoI promotes the following exports materials to increase the productivity of SMEs:

Textile articles:

Blankets and travelling rugs
Bed linen, knitted or crocheted, toilet linen and kitchen linen, of terry towelling or similar terry fabrics.
Curtains (including drapes) and interior blinds; curtain or bed valances.

Furnishing articles:

Bedspreads, counterpanes, napkins, pillow case and pillow slip, table cloth and table cover, Towels

Tarpaulins, awnings and sun blinds, tents, sails for boats, sailboards or land craft and camping goods

Made up articles:

Dress patterns such as floorcloths, dishcloths, dusters and similar cleaning cloths, life jackets and lifebelts

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Frequently Asked Questions

Common questions about Rebate of State Levies.

The Rebate of State Levies (RoSL) scheme is an initiative by the Government of India to support the textile sector by providing zero-rated taxation on apparel and made-up products. It aims to boost the competitiveness of Indian textile exports in the global market and create new employment opportunities.

The RoSL scheme was introduced to replace the Merchandise Exports from India (MEIS) and Service Exports from India (SEIS) schemes, which offered 4% support for garments and made-ups but became unavailable after December 31. The RoSL scheme ensures zero-rated taxation for apparel and made-up exports, allowing Indian exporters to compete with countries like Sri Lanka, Bangladesh, Cambodia, and Vietnam, which enjoy zero taxation.

The key objectives of the RoSL scheme include increasing the export production of apparel and made-ups, providing zero-rated export taxes to compete in the global market, ensuring timely disbursal of tax benefits to traders and manufacturers, minimizing costs and increasing sales and turnover, creating more manufacturing units and employment opportunities, and promoting quality process management and global marketing for the textile industry.

The RoSL scheme benefits exporters by providing zero-rated taxation on apparel and made-up products, enabling them to increase their export competitiveness, traffic, and sales in the global market. It also helps them compete against countries that enjoy zero taxation, especially when exporting to the European Union, which is India's largest export market for the apparel sector.

The Government of India implemented the RoSL scheme from March 7, 2019, to March 31, 2020, through an IT-driven Scrip System to ensure swift distribution of products and prevent delays.

The RoSL scheme boosts the transition of business for small and medium garment manufacturers by implementing zero-rated tax, which decreases the purchase value of the product and increases the profit margin for traders and manufacturers. It also promotes exports of various textile articles, furnishing articles, and made-up articles from these manufacturers.

The RoSL scheme is expected to significantly boost India's economy by increasing the productivity and export intensity of the textile industry, which contributes 56% of the sector. It will lead to growth in manufacturing units, employment opportunities, and overall economic growth.

Under the RoSL scheme, rebates offered by states on stamp duty, petroleum tax, electricity duty, and mandi tax embedded in exports will be extended to the textile industry, providing additional support and reducing the overall cost burden for exporters.

The implementation of the RoSL scheme through an IT-driven Scrip System aims to ensure the swift distribution of products and prevent any delays in the disbursal of tax benefits to traders and manufacturers, enabling them to promptly meet the demands of the versatile textile market.

While the MEIS and SEIS schemes offered 4% support for garments and made-ups, the RoSL scheme provides zero-rated taxation on apparel and made-up exports, making Indian textile products more competitive in the global market. It addresses the need for a more comprehensive and targeted approach to support the textile industry's export competitiveness.