Exporters to receive online refund of input tax credit from next fiscal
Exporters can hope for speedier refund of input tax credit (ITC) from the next fiscal with the GST Council recommending online refund of the tax.
Clearance of pending ITC refunds, estimated by exporters at around Rs. 10,000 crore, will also gain traction once the refund happens entirely online.
“It is very encouraging that the GST Council has also recommended online ITC refund mechanism for exports. We are hopeful that it may start from the next fiscal,” said Ajay Sahai, Secretary-General, FIEO.
The process of ITC refund at present is partly online and partly manual. Exporters complain that the manual part not only adds to time and costs, but also places them at the mercy of tax officials who, at times, ask for irrelevant documents.
Commerce Ministry officials say that while some glitches still remained in the refund of ITC, especially due to some States reluctant in parting with their funds, the problems related to refund of IGST (Integrated GST) had been sorted out. “We are happy that because of our continued interaction with exporters and officials in the Finance Ministry, we were successfully able to identify all problems related to refund of IGST and refunds are happening smoothly now,” the official said.
Sahai said that IGST was now more or less streamlined except for ICD (Inland Container Depot) shipments.
“Many of the hinterland exporters complain that when they are filing shipments, one or two cases out of ten remain pending because of fault of the shipping lines. These errors are not attributable to exporters,” he said.
Under the GST regime, exporters have to pay the tax upfront and then apply for a refund. The Government is working on an e-wallet system under which a notional credit would be transferred to the exporters’ accounts based on their past record and the credit can be used to pay taxes on inputs.
Source :- Dailyshippingtimes.com