(RTTNews) - The first meeting of the newly formed committee will be held this week to discuss the reimbursement of service tax to exporters. The committee will also look into issues related to speedy reimbursement of the terminal excise duty, a measure announced as part of the first stimulus package in December 2008, reports media.

The Indian Government earlier allowed reimbursement of service tax on around 19 services used by exporters while selling goods overseas. These include commission paid to foreign agents whose services are subscribed by exporters to book orders with overseas clients.

However, a list of 16 services used by exporters left untouched. These include service tax paid on bank charges, packaging services, and travel agents’ services.

In case the remaining services are allowed for reimbursement, the Indian exporter will be able to add on some competitive advantage to the goods that are being sold in the international market, said a foreign trade expert. However, the quantum of saving on account of reimbursing taxes on these 16 services could not estimated.

Indian exports dipped for two consecutive months in October and November, while initial estimates available with the commerce ministry showed that overseas sale of Indian goods in December 2008 is also likely to contract.

The government today released Rs.600 crores for reimbursement of pending Terminal Excise Duty and Duty Drawback to exporters, a Commerce Ministry release said. In addition, the government also released Rs.200 crores for reimbursement of Central Sales Tax for units supplying goods to 100% Export Oriented Units.

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