UPSC Prelims Practice Questions — RoSCTL, RoDTEP schemes extended by Union govt.

Q1. A country wants to reimburse its exporters for taxes paid in producing exported goods while keeping the measure outside the definition of a subsidy under the WTO Agreement on Subsidies and Countervailing Measures. Consider the following designs: Which of the designs given above would satisfy this objective?

  1. Remitting only the indirect taxes actually borne on inputs of the exported product, in amounts not exceeding those that have accrued
  2. Remitting a part of the firm's corporate income tax in proportion to its export earnings
  3. Remitting a flat percentage of free-on-board value, set higher for priority markets, irrespective of the taxes actually incurred
  • A. 1, 2 and 3
  • B. 1 only
  • C. 1 and 2 only
  • D. 1 and 3 only

Q2. A manufacturer-exporter of engineering goods incurs the following taxes in the course of production and shipment: Which of the above would typically remain embedded in the cost of the exported product and hence fall within the scope of RoDTEP?

  1. VAT on diesel used by the trucks that carry its goods to the port
  2. Electricity duty on power consumed in its factory
  3. GST charged by a registered supplier on packaging material
  4. Central excise duty on diesel used to run its captive generator sets
  • A. 2, 3 and 4 only
  • B. 1 and 2 only
  • C. 1, 2, 3 and 4
  • D. 1, 2 and 4 only

Q3. Consider the following statements: Which of the following is correct in respect of the above statements?

  1. Even after the introduction of GST, the price of an Indian export can carry state and local levies that the GST refund mechanism does not return to the exporter.
  2. Levies such as mandi tax and electricity duty lie outside GST, so no input tax credit is available for them against output tax.
  • A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
  • B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
  • C. Statement-I is correct, but Statement-II is incorrect
  • D. Statement-I is incorrect, but Statement-II is correct

Q4. With reference to the instruments that neutralise taxes on India's exports, consider the following statements: Which of the statements given above is/are correct?

  1. An apparel exporter can receive RoSCTL in addition to Duty Drawback, because the two neutralise different sets of taxes.
  2. The RoDTEP rebate is not available on duties and taxes that have already been exempted, remitted or credited under another mechanism.
  3. Zero-rating allows an exporter to claim a refund of GST paid on inputs, but it cannot reach levies that lie outside GST.
  • A. 2 and 3 only
  • B. 1 only
  • C. 1, 2 and 3
  • D. 1 and 3 only

Q5. Consider the following exports from India: Which of the above are covered under RoSCTL rather than RoDTEP?

  1. Knitted cotton T-shirts
  2. Cotton bed linen
  3. Polyester filament yarn
  4. Woven denim fabric
  • A. 1 and 2 only
  • B. 1, 2, 3 and 4
  • C. 1, 2 and 4 only
  • D. 3 and 4 only

Q6. Consider the following statements: Which of the following is correct in respect of the above statements?

  1. The Government of India describes RoDTEP as compliant with WTO norms, even though, like MEIS, it gives exporters their benefit through transferable scrips.
  2. In 2023, India and the United States notified a mutually agreed solution in the DS541 dispute, and the panel report was consequently not adopted.
  • A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
  • B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
  • C. Statement-I is correct, but Statement-II is incorrect
  • D. Statement-I is incorrect, but Statement-II is correct

Q7. Consider the following facts: On 30 September 2026, the Union Government extended RoDTEP and RoSCTL, which refund embedded, non-creditable levies on exported goods, by three months to 31 December 2026, with rates unchanged. The Commerce Ministry had sought a five-year extension, and the final decision rests with the Finance Ministry. Exporters typically finalise orders months before shipment. Which of the following inferences can be drawn from the above?

  1. The Finance Ministry has finally rejected any extension of the schemes beyond December 2026.
  2. An exporter quoting today for a shipment due in March 2027 cannot be certain of factoring the refund into its price.
  3. Because rates were left unchanged, the schemes must have been reviewed and cleared by a WTO dispute panel.
  4. Were the schemes to lapse, levies that remain outside the GST credit chain would again become part of the price of Indian exports.
  • A. 2 and 4 only
  • B. 2, 3 and 4 only
  • C. 2 only
  • D. 1, 2 and 4 only