The Centre is in discussions with the States on the issue of formula for refund of all State-level taxes borne by exporters, the Commerce and Industry Minister, Mr Kamal Nath, has said.

This is important as States must also be wanting investment of export based industries. There are several formulae under consideration for refund of taxes. Either States themselves can refund/rebate or adjust it against allocation made to them (from the Centre), he told reporters on the sidelines of PHD Chamber of Commerce and Industry (PHDCCI) annual session held here today.

Mr Nath said that States have to generate employment and encourage exports and therefore the Centre was sensitising them on the need to refund/rebate taxes so that no taxes are exported.

The Finance Minister, Mr P. Chidambaram, had on Wednesday urged States to look at refund/rebate of all State-level taxes levied on goods and services exported from the country.

This also implied that the Finance Ministry was not keen to rebate or refund any taxes collected by the States from export goods. The Commerce Ministry was pushing for changes to the DEPB scheme so as to rebate State-level levies to exporters. This was however not acceptable to the Finance Ministry.