Aftermath of GST on Indian Imports

There has been a setback in the preparation of tax refunds under the Goods and Services tax regime resulting in lockup of funds of the exporter. This had major impacts on the ability of the exporters to be internationally competitive. There was a meeting held on September 19 to discuss the issues that are related to export sector after GST implementation, with the head of the committee Revenue Secretary, Hasmukh Adhia.In the course of the meeting, the Federation of Indian Export Organisation stressed that the exporters refund process should be fast tracked by the government or as much as 65,000 crore could be blocked in the July-October period, that will affect the business potential of the exporters.The Indian exports were not doing well in the month before GST regime was implemented. The export growth rate fell during March-July before it inclined again in August. But the export organisations fear that the growth curve could decline again owing to the negative impacts of GST.For the inputs by the suppliers, it is a requisite for the exporters to pay GST. As the exports are tax free, they can demand refunds from the government.A speaker from the Federation of Indian Export Organisation said that the shooting liquidity crunch has affected majority of the exporters as the money paid by them in the form of tax are blocked by the government. The refund of the taxes for the month of July can be expected only in December.As the deadlines for filing the returns are persistently pushed back, the process of fund claiming is becoming more time consuming than anticipated.
Kranthi Tilak Reddy
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Aftermath of GST on Indian Imports

Kranthi Tilak Reddy
News Article
27th Sep, 2017
Aftermath of GST on Indian Imports

There has been a setback in the preparation of tax refunds under the Goods and Services tax regime resulting in lockup of funds of the exporter. This had major impacts on the ability of the exporters to be internationally competitive.

There was a meeting held on September 19 to discuss the issues that are related to export sector after GST implementation, with the head of the committee Revenue Secretary, Hasmukh Adhia.

In the course of the meeting, the Federation of Indian Export Organisation stressed that the exporters refund process should be fast tracked by the government or as much as 65,000 crore could be blocked in the July-October period, that will affect the business potential of the exporters.

The Indian exports were not doing well in the month before GST regime was implemented. The export growth rate fell during March-July before it inclined again in August. But the export organisations fear that the growth curve could decline again owing to the negative impacts of GST.

For the inputs by the suppliers, it is a requisite for the exporters to pay GST. As the exports are tax free, they can demand refunds from the government.

A speaker from the Federation of Indian Export Organisation said that the shooting liquidity crunch has affected majority of the exporters as the money paid by them in the form of tax are blocked by the government. The refund of the taxes for the month of July can be expected only in December.

As the deadlines for filing the returns are persistently pushed back, the process of fund claiming is becoming more time consuming than anticipated.

Kranthi
Blog Author

Kranthi Tilak Reddy is one of the co founders and COO of White Matter Advisory services P Ltd. He is an Engineering graduate from SRM University and has done his Masters in finance.Being a true go-getter and an optimist to the core he has grown up the ranks in banking industry at an astonishing rate, his last stint being Associate Director, Business Clients -South with Standard Chartered Bank. With over 10 years of association with SME businesses and clients he certainly brings rich vein of expertise to the WMA table but more importantly his alluring passion towards great and customer service” the foundation on which he asserts WMA has been built.

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