Government should make changes in GST Act and procedures governing Exports - FIEO
NEW DELHI: Concern of exporters on liquidity, excessive documentation process and delays due to lack of knowledge on the part of both exporters as well as tax officials, etc were discussed by the participants in the well-attended Post GST Seminar held at Chennai on July 25, 2017. The Seminar was organized by FIEO to take stock of the progress and implementation challenges after the implementation of GST.
Liquidity problems arise as the process requires payment of GST first while procuring the inputs and get refund subsequently after some lag. This also leads to blockage of working capital. While exporting also exporters needs to pay IGST or take exemption under LUT/Bond which increases compliance costs. Exporters have demanded an exemption mechanism instead of first paying tax and then claiming refund.
Mr Ganesh Kumar Gupta, President, FIEO while inaugurating the session said FIEO sought help form Commerce and Industry Ministry, Government of India in sorting out some of the problems of exporters who have assured FIEO that needful will be done to settle the issues. FIEO President requested that entire refund mechanism for exporters should be brought into one window for reducing transaction time and cost. He hoped that the forthcoming review of Foreign Trade Policy will take into consideration all the issues and constrains faced by the exporters today. Now after initial hiccup, focus will be on returns and related documentation.
FIEO Chief assured all support to the exporters for compliance related issues and said that FIEO has set up GST assistance cell in all its offices for helping exporters in this direction. He also said that competitiveness of Indian exporters will reduce by 2% due to interest burden on them.
Dr A Sakthivel, Regional Chairman, FIEO Southern Region said that there still needs to be clarity on a number of issues, export benefits being one of them. FIEO is getting queries from hundreds of exporters per day on the impact of GST on their business, and have been trying to answer them as best as we can.
The learning curve is going to be steep, at least for the next 3-4 months, hence next two quarters will be difficult for exporters. Dr Sakthivel complimented the CBEC for announcing relaxation in filing of returns and compliances for first two quarters.
Mr M Rafeeque Ahmed, Vice President, FIEO raised the problem in claiming ITC refund as the same requires filing of GSTR which for July will be done by 20th Sept and thus claims will be delayed by over 3 months. He also urged to provide composite Drawback rate on self-declaration trusting the trade.
Dr Ajay Sahai, Director General & CEO, FIEO in his analysis on GST and International Trade said that GST will add to the competitiveness of exports particularly as logistics cost and time will come down after introduction of e-way bill. He assured that the problems of job work particularly regarding rates and interstate supply for job work are likely to be addressed shortly. Dr Sahai provided clarification on various issues during his presentation.
Mr C P Rao, Principal Chief Commissioner, GST & Central Excise, Tamilnadu & Pondicherry said that there were some initial hiccups and that the Government has introduced a fast-track process for the refund of taxes and duties to exporters under which 90% of the duties will be refunded within seven days.
The remaining 10% will be made after the verification of accounts by tax authorities. He assured that the Government will explore all options to neutralise the impact of GST on the export sector. He also said that Govt. is very receptive and taking quick actions as and when issues are raised.
source:- daily shipping times
CAclubindia
