AFFECTED FLOWOutflow (subsidised)
ANNOUNCED AS TEMPORARYYes
Tax-based export incentive
The Indian Ministry of Commerce and Industry has increased the exports incentives under the Merchandise Exports Incentive Scheme (MEIS) for readymade garments and made-ups within the textile sector. Specifically, the incentive rates have been increased for these products have been increased from 2% to 4% of exports FOB value.
These enhanced rates are effective from 1 November 2017 to 30 June 2018. The inception date of this act has been set as 24 November 2017, the date of the announcement, as the export decisions are expected to be affected only after the announcement is made.
The higher rates earlier announced temporarily were later extended indefinitely vide Public Notice 7/2015-2020 on 11 May 2018.
The MEIS provides incentives on product exports, ranging from 2% to 5% based on the product and the country they are exported to.
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