What is Export Promotion Capital Goods (EPCG) Scheme?
The objective of the Capital Export Promotion Program (EPCG) is to facilitate the import of capital goods for the production of quality goods and services and to improve the competitiveness of the industry. India. The EPCG program allows the import of production materials for preparation, production, and post-production without paying customs fees. Production materials imported under the EPCG for physical export are exempt from IGST and cease to be compensated until March 31, 2020. In addition, exporters can also purchase capital goods domestically according to the provisions of paragraph 5.07 of FTP. Materials produced for the purposes of the EPCG program include:
– Means of production as defined in Chapter 9
– Computer systems and software are part of the means of production
– Spare parts, molds, dies, jigs, fixtures, tools, and refractory materials
– Catalyst for the first charge plus the next charge
The EPCG mechanism includes exporting producers with or without supporting producer(s), commercial exporters associated with supporting producer(s), and service providers.
Prerequisites to apply for the EPCG program:
To apply for the EPCG program, an IEC is required. Other prerequisites as mentioned in Chapter 5 of the Foreign Trade Policy and Procedure Manual may be addressed.
Services Under EPCG
- Receipt from Challan Treasury (if fees are not paid electronically) evidencing payment of the application fee in accordance with Schedule 2L.
- Self-certified copy of MSME/IEM/LOI/IL for product or self-certified copy of tax registration for service for service provider. (in the case of service providers who have not yet registered their services with the tax authorities, a declaration on this matter will be submitted as part of the application (form 6), no registration number required service tax. relevant EPC RCMC cases are sufficient). Certificate of a licensed professional engineer in the format set out in Appendix 5A.
- Certificate of Certified Public Accountant/Analytical Accountant/Company Secretary in Appendix 5B.
There Are Two Types Of Export Obligation That Are Mandatory:
- Average Export Obligation For Preceding 3 Years Exports.
- Specific Exports 6 Times Of The Duty Saved Amount In Six Years.