New Delhi, Mar 12 (KNN) In a bid to facilitate relief among the exporters, the
GST Council in its 26thmeeting announced extending available tax exemptions on imported goods for further 6 months.
Earlier the exemption period was to expire on 31st March.
“The exporters presently availing various export promotion schemes can now continue to avail such exemptions on their imports upto 01.10.2018, by which time an e-Wallet scheme is expected to be in place to continue the benefits in future”, an official release said.
In a related development which would benefit the exporters, the Council reviewed the progress in grant of refunds to exports of both IGST and Input Tax Credit. The Council appreciated that the pace of grant of IGST refund has picked up.
The Council also directed GSTN to expeditiously forward the balance refund claims to the Customs/Central GST/State GST authorities, as the case may be, for their immediate sanction and disbursal.
Earlier, different sectors raised their concern regarding cash blockage due to upfront GST/IGST on inputs, raw materials etc. Following which an interim solution was found by re-introducing the pre-GST tax exemptions on such imports.
Additionally, for merchant exporters a special scheme of payment of GST @ 0.1% on their procured goods was introduced. Also, domestic procurement made under Advance Authorization, EPCG and
EOU schemes were recognized as 'deemed exports' with flexibility for the suppliers or the exporters being able to claim a refund of GST / IGST paid thereon. All these avenues were made available upto 31.03.2018.
The permanent solution agreed to by the Council was to introduce an e-Wallet scheme w.e.f. 01.04.2018. The e-Wallet scheme is basically the creation of electronic e-Wallets, which would be credited with notional or virtual currency by the DGFT. This notional / virtual currency would be used by the exporters to make the payment of GST / IGST on the goods imported / procured by them so their funds are not blocked.
While the e-wallet system is still not functional, the government informed that this would require more time, therefore it announced defering the implementation of the e-Wallet scheme by 6 months i.e., upto 01.10.2018.
It also decided to extend the present dispensation in terms of exemptions etc. which is available up to 31.03.2018, for a further 6 months i.e., upto 01.10.2018.
Source: knnindia.co.in