The Export Promotion Council of India EOU & SEZ under the Ministry of Commerce, Government of India today held an open house meet on discussing and resolving the issues and concerns of Exporters with reference to the GST.
More than 250 exporters from EOU and SEZ all over the country participated in the open house meet and gave various suggestions to the powerful panel consisting of policy makers and regulators. Shri Arun Goyal, Special Secretary, GST Council, Shri Yogendra Garg, Additional Director General, Directorate of GST, Dr. L.B. Singhal, Development Commissioner, Noida SEZ, Shri Dheeraj Rastogi, Joint Secretary, GST Council, Vice President GSTIN, and representative of NSDL were accompanied with officials from Ministry of Commerce & Industry, Ministry of Finance, CBEC, CBDT.
The exporters tabled multiple suggestions with an intention to facilitate “Ease of doing business” and tabled the concerns under the following categories:
- GST Issues related to refunds
- GST Issues related to exemption of GST
- GST issue related to the classification of Goods and services and place of supply for service exports
- GST issue related to GSTN
Dr. Vinay Sharma, Chairman of the EPCES said, “This open house is one of the several initiatives EPCES has taken to facilitate a dialogue between our members and policy makers. Several important issues and suggestions were tabled by our members and the policy makers took note of the same. We have compiled all the suggestions and made a written representation of these suggestions to Ministry of Commerce & Industry, Ministry of Finance, CBEC, CBDT, NSDL and members of the GST Council. EPCES has been at forefront of facilitating PMO’s vision of ‘Ease of doing business’ from EOU & SEZ in India”
Amongst the various suggestions provided by the industry, one of the recommendation was to link the GSTN portal with the NSDL portal for smooth facilitation of the GST refunds. Exporters have claimed that over 60% of their refunds are stuck with the government complaining that delay in GST refund has blocked their working capital. The government has sanctioned GST refunds to exporters to the tune of Rs 17,616 crore till March.
Another important suggestion was abot the option for SEZ units to claim refund of the GST charged by suppliers. Currenty, a supplier can provide goods / services to units in SEZ under LUT (Legal Undertaking) without payment of IGST, alternately they can reclaim the refund. Many suppliers do not want to go for LUT or refund process and charging GST in their invoice which is a cost burden for SEZ Unit.
Under existing law there is no option for SEZ unit to claim the refund of the same. The ministry officials today announed that they will develop a process of claiming refund by SEZ Units. The GSTN team will enable facility of refund claim by supplier to EOU Unit for deemed export. They will also enable claiming refund for more than one month. GSTN team is also working towards changing of category as SEZ Unit/ SEZ Developer instead of regular.
In a recent advance ruling, GST is applicable on supply of goods from Duty free shop at airport. Under Section 15 of IGST, refund of GST can be claimed on supply of good to outbound tourist live in India. EPCSE has requested to issue the rule for claiming of refund for such supply made to international outbound tourist.
Dr. Sharma added that “The business in the 204 Special Economic Zones (SEZ) have clocked 18% increase, year on year between 2016-17 and 2017-18 which demonstrates the Ease of doing business in SEZs”.
He added that “we have also suggested to treat SEZ as outside India (deemed foreign territory) for the purpose of place of supply rule under IGST for service export. If implemented, it will be a big relief for service industry in SEZ and Free Trade Warehousing Zone specially units established for international client.”
The software export from the SEZ has also seen a surge of 17% year on year basis between years ending March 2017 and March 2018. India has exported software worth 277,857 crore against 237,771 crore last year.
The combined export from SEZs in India of merchandise and software has been in tune of 5,51,344 crores as against 4,68,567 crores in last year
