A government panel headed by the Revenue Secretary will meet on September 19 to resolve a ‘$10 billion-problem’ troubling India’s exporters and its potential adverse impact on jobs.
Official sources told The Hindu that the Revenue Secretary-led ‘Committee on Exports’ — set up on September 12 to address exporters’ concerns over the Goods and Services Tax (GST) regime — would, among other things, take up the issue of “inordinate delay in refund of GST to exporters” and the consequent blockage of working capital that is severely affecting exporters’ liquidity and enhancing their tax burden.
Tax credit refund
According to Ajay Sahai, director general and CEO, Federation of Indian Export Organisations (FIEO), “Exporters were expecting that the Integrated GST (IGST) refund or refund of input tax credit (ITC) would be available to them in August, 2017 for the exports made during July.” He added, “However, since the filing of (GST returns) GSTR-1,2 and 3 for July has been extended till October 10, October 31 and November 10, respectively, exporters will not be able to get the refund by November.”
Mr. Sahai said since exporters would have to wait till around December (considering 15 days for issuance of acknowledgement and another seven days for getting provisional refund of 90% of the total refund claim) for availing refund of the GST on exports, it would mean that they would have to arrange funds from their own sources to pay GST for the July-October period. The blocked amount for the four months time is estimated to be about $10 billion, Mr. Sahai pointed out, adding that the situation could lead to huge job losses.
“The government should trust the trade,” FIEO said in a representation.
COMMents
SHARE