To avail such import benefits, EOUs will have to follow the procedure under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.
(FAQ 13: EXPORTS)
Whether supplies to or from EOU will be exempted from GST
No.
• Under the GST Law, IGST or CGST plus SGST will be payable by the suppliers who make supplies to the EOU. The EOU will be eligible to take Input Tax Credit of the said GST paid by its suppliers. • The supplies from EOU will not be exempted from GST, except in the case of zero rated supplies defined under section 16 of the IGST Act, i.e. supplies made by EOU in the form of physical export or supplies to a SEZ Unit or SEZ Developer for authorized operations.
(FAQ 12: EXPORTS)
What tax benefits will be available to EOU scheme in GST regime
The duty free imports under GST regime will be restricted to Basic Customs Duty. Exemption from the additional duties of Customs, if any, under section 3(1), 3(3) and 3(5) of the Customs Tariff Act, 1975 and exemption from
Central Excise duty will be available for goods specified under the fourth Schedule to the Central Excise Act. IGST or CGST plus SGST will be payable by the suppliers who make supplies to the EOU. The EOU will be eligible, like any other registered person, to take Input Tax Credit of the said GST paid by its suppliers.
(FAQ 11: EXPORTS)
Whether the EOU scheme will continue to be in operation in the GST regime and whether EOU is required to take registration under the GST Law
EOU is like any other supplier under GST and all the provisions of the GST Law will apply. However, the benefit of Basic Customs Duty exemption on imports will continue.
(FAQ 10: EXPORTS)
What is deemed export under GST Law? Whether any supply has been categorized as deemed export by the Government
Deemed export has been defined under Section 2(39) of CGST Act, 2017 as supplies of goods as may be notified under section 147 of the said Act. Under section 147, the Government may, on the recommendations of the Council,
notify certain supplies of goods manufactured in India as deemed exports, where goods supplied do not leave India, and payment for such supplies is received either in Indian rupees or in convertible foreign exchange. However,
till date, the government has not notified any supply as deemed export.
(FAQ 9: EXPORTS)
Will export of goods to Nepal and Bhutan treated as zero rated and thereby qualify for all the benefits available to zero rated supplies under the GST regime
Export of goods to Nepal or Bhutan fulfils the condition of GST Law regarding taking goods out of India. Hence, export of goods to Nepal and Bhutan will be
treated as zero orated and consequently will also qualify for all the benefits available to zero rated supplies under the GST regime. However, the definition of ‘export of services’ in the GST Law requires that the payment for such services should have been received by the supplier of services in convertible
foreign exchange.
( FAQ 9: EXPORTS)
How soon will refund in respect of export of goods or services be granted during the GST regime
(a) In case of refund of tax on inputs used in exports:
• Refund of 90% will be granted provisionally within seven days of acknowledgement of refund application.
• Remaining 10% will be paid within a maximum period of 60 days from the date of receipt of application complete in all respects.
• Interest @ 6% is payable if full refund is not granted within 60 days.
(b) In the case of refund of IGST paid on exports: Upon receipt of information regarding furnishing of valid return in Form GSTR-3 by the exporter from the common portal, the Customs shall process the claim for refund and an amount equal to the IGST paid in respect of each shipping bill shall be credited to the bank account of the exporter.
( FAQ 7: EXPORTS)
When a SEZ unit or SEZ developer procures any goods or services from an unregistered supplier, whether the SEZ unit or SEZ developer needs to pay IGST under reverse charge or these will be zero rated supplies
Supplies to SEZ unit or SEZ developer have been accorded
the status of inter-State supplies under the IGST Act.
Under the GST Law, any supplier making inter-State supplies
has to compulsorily get registered under GST. Thus anyone
making a supply to a SEZ unit or SEZ developer has to necessarily
obtain GST registration.
(FAQ 6: EXPORTS)
The supplies to a SEZ unit or SEZ developer are treated as zero rated supplies in the GST Law. Then why there is no specific mention in the GST Law about not charging of tax in respect of supplies from DTA unit to a SEZ unit or SEZ developer
Yes, supplies made to an SEZ unit or a SEZ developer are zero rated. The supplies made to an SEZ unit or a SEZ developer can be made in the same manner as supplies made for export:
• either on payment of IGST under claim of refund;
• or under bond or LUT without payment of any IGST.
(FAQ 5: EXPORTS)
For merchant exporters, is there any change in the Export Procedure under the GST regime
The concept of merchant or manufacturer exporter would become irrelevant under the GST regime. The procedure in respect of the supplies made for export is same for both merchant exporter and a manufacturer exporter.
(FAQ 4: EXPORTS)