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How will gst affect imports and importers !!!

Are you an importer ? If you are then this article is for you. Here, we will try our best to clear all your doubts on how GST will influence you and business. First understand, what is the meaning of imports. Imports mean bringing into Indian territory from a place outside India. in the present tax regime various taxes are charged in case of import of goods such as countervailing duty (CVD), Special additional duty (SAD), Basic custom duty (BCD) etc.

As per the Model GST Law, GST will include Countervailing Duty(CVD) and Special Additional Duty (SAD), however, Basic Customs Duty will be a separate law from GST. Thus, BCD has been kept outside the purview of GST and will be charged as per the current law only.

Below are some of the implications for imports and importers by virtue of GST implementation in India:

Import of goods as Inter-State Supply – Import into India will be considered as Inter-State supply under Model GST Law and accordingly will attract Integrated Goods and Services Tax (IGST) along with BCD and other surcharges.

Import of Services – Model GST law accord liability of payment of tax on the service receiver, if such services are provided by a person residing outside India. This is similar to the current provision of reverse charge, wherein service receiver is required to pay tax and file return.

Refund of IGST – As mentioned above IGST will be levied on imports. Presently SAD is levied on imports, the credit of which is available to the manufacturer and refund of the same is allowed to a trader. Also, credit of CVD which is equivalent to excise duty now is available to a manufacturer and service provider but not available to a trader. This was an inequality between the various classes of businessmen. Now, apart from customs duty, there is only one tax and credit of which shall also be available to a registered person.

Withdrawal of Current Exemptions – Presently, the customs import duty is given multiple exemption notifications which are likely to reviewed and possibly withdrawn or converted into a refund mechanism. This could mean change in the structure of export-linked duty exemption schemes under the foreign trade policy where the duty exemptions may get limited to exemption from payment of custom duty, while IGST may not be exempted. Withdrawal of exemptions or changing them to refund mechanism could fundamentally change the attractiveness and viability of some of the key schemes under the foreign trade policy like Export oriented units, Advance authorization licenses etc.

If you have any further queries relating to imports and GST you can write down on the comments below or ping us at Quaremon section of our website.

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As per the Model GST Law, GST will include Countervailing Duty(CVD) and Special Additional Duty (SAD), however, Basic Customs Duty will be a separate law from GST. Thus, BCD has been kept outside the purview of GST and will be charged as per the current law only.
Below are some of the implications for imports and importers by virtue of GST implementation in India:
<ul>
<li>Import of goods as Inter-State Supply &ndash; Import into India will be considered as Inter-State supply under Model GST Law and accordingly will attract Integrated Goods and Services Tax (IGST) along with BCD and other surcharges.</li>
</ul>
&nbsp;
<ul>
<li>Import of Services &ndash; &nbsp;Model GST law accord liability of payment of tax on the service receiver, if such services are provided by a person residing outside India. This is similar to the current provision of reverse charge, wherein service receiver is required to pay tax and file return.</li>
</ul>
&nbsp;
<ul>
<li>Refund of IGST &ndash; As mentioned above IGST will be levied on imports. &nbsp;Presently SAD is levied on imports, the credit of which &nbsp;is available to the manufacturer and refund of the same is allowed to a trader. Also, credit of &nbsp;CVD which is equivalent to excise duty now is available to a manufacturer and service provider but not available to a trader. This was an inequality between the various classes of businessmen. Now, apart from customs duty, there is only one tax and credit of which shall also be available to a registered person.</li>
</ul>
&nbsp;
<ul>
<li>Withdrawal of Current Exemptions &ndash; Presently, &nbsp;the customs import duty is given multiple exemption notifications which are likely to reviewed and possibly withdrawn or converted into a refund mechanism. This could mean change in the structure of export-linked duty exemption schemes under the foreign trade policy where the duty exemptions may get limited to exemption from payment of custom duty, while IGST may not be exempted. Withdrawal of exemptions or changing them to refund mechanism could fundamentally change the attractiveness and viability of some of the key schemes under the foreign trade policy&nbsp;like Export oriented units, &nbsp;Advance authorization licenses &nbsp;etc.</li>
</ul>
If you have any further queries relating to imports and GST you can write down on the comments below or ping us at Quaremon section of our website.

As per the Model GST Law, GST will include Countervailing Duty(CVD) and Special Additional Duty (SAD), however, Basic Customs Duty will be a separate law from GST. Thus, BCD has been kept outside the purview of GST and will be charged as per the current law only.
Below are some of the implications for imports and importers by virtue of GST implementation in India:
<ul>
<li>Import of goods as Inter-State Supply – Import into India will be considered as Inter-State supply under Model GST Law and accordingly will attract Integrated Goods and Services Tax (IGST) along with BCD and other surcharges.</li>
</ul>
 
<ul>
<li>Import of Services –  Model GST law accord liability of payment of tax on the service receiver, if such services are provided by a person residing outside India. This is similar to the current provision of reverse charge, wherein service receiver is required to pay tax and file return.</li>
</ul>
 
<ul>
<li>Refund of IGST – As mentioned above IGST will be levied on imports.  Presently SAD is levied on imports, the credit of which  is available to the manufacturer and refund of the same is allowed to a trader. Also, credit of  CVD which is equivalent to excise duty now is available to a manufacturer and service provider but not available to a trader. This was an inequality between the various classes of businessmen. Now, apart from customs duty, there is only one tax and credit of which shall also be available to a registered person.</li>
</ul>
 
<ul>
<li>Withdrawal of Current Exemptions – Presently,  the customs import duty is given multiple exemption notifications which are likely to reviewed and possibly withdrawn or converted into a refund mechanism. This could mean change in the structure of export-linked duty exemption schemes under the foreign trade policy where the duty exemptions may get limited to exemption from payment of custom duty, while IGST may not be exempted. Withdrawal of exemptions or changing them to refund mechanism could fundamentally change the attractiveness and viability of some of the key schemes under the foreign trade policy like Export oriented units,  Advance authorization licenses  etc.</li>
</ul>
If you have any further queries relating to imports and GST you can write down on the comments below or ping us at Quaremon section of our website.

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How will gst affect imports and importers !!!