BUSINESS

‘Enforcement regime won’t be harsh on exporters’

Rita Teaotia

Rita Teaotia  

Centre to advance FTP review to align it with GST roll-out

The enforcement regime will not be harsh for the country and individual exporters in the initial phase of the roll-out of Goods and Services Tax (GST), said Union Commerce Secretary Rita Teaotia.

At an interactive meeting organised by the Federation of Indian Export Organisations (FIEO), EEPC India and the Gems & Jewellery Export Promotion Council, Ms. Teaotia said that the Centre was planning to advance the mid-term review of the Foreign Trade Policy (introduced in 2015) to align it with the GST implementation. “There are several things that may need tweaking in the FTP,” she said.

The review is due in September.

Director General of Foreign Trade A.K. Bhalla explained that at least three different schemes – the advance authorisation, export promotion capital goods (EPCG) and duty free import authorisation – would cease to exist once GST rolled out. Some other schemes would also need to be worked on once the new tax regime kicked in, he said.

An exporter will need to pay the applicable taxes on transactions but can seek refund. Tax exemptions are not given to them as it could break the GST chain, it is learnt.

Exporters who were getting refunds through many schemes as export incentives are worried that their competitiveness may now be eroded.

FIEO President Ganesh Gupta pointed out that the cost of capital to Indian exporters was higher than the international benchmark.

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