Skip to main content

Centre to make provision for GST refund in excise free zones


The Union government has moved a proposal to make a budgetary provision for refunding its share of area based exemptions on indirect taxes given to certain states in the past.

In last week´s meeting of thee goods and services tax (GST) Council, it was decided that ´all entities exempted under payment of indirect tax under any existing incentives scheme of central or state governments shall not continue under the GST regime and existing units shall pay tax under the GST regime´.

Under the discretionary powers left to it by the Council regarding these incentives, the finance ministry has proposed to provide budgetary support for refunding its share in GST to such units to which exemptions in indirect taxes were granted, for promoting industrialisation.

The units are situated in Jammu &Kashmir, Himachal Pradesh, Uttrakhand and the north eastern states, In these states, some areas have been catagorised as excise free
zones and units in those areas were eligible for expemptions.

According to a finance ministry official,a budgetary provision will be made to refund the central government´s share in those incentives for the residual period of the unit. The refund will apparently be to the extent of 58 per cent of the Centre´s share of GST.

Since different units were set up at different intervals and their residual or balance period from the time they were set up could be different, the ministry proposes to calculate budgetary support on a monthly basis, said the source.

Certain limitation conditions regarding the benefits assured prior to GST implementation are proposed to be continued.According to the proposal, refund will be calculated after deducting input credit, if applicable foraunit. To ensure are fund is granted well in time,a proposal has been made that are fund application will have to be filed electronically by the seventh of the month succeeding the month in which GST has been paid; the refund will be granted in a month. This budgetary support will be paid from budgetary allocations made to the department of industrial policy and promotion under the ministry of commerce.

Business Standard New Delhi, 07th July 2017

Comments

Popular posts from this blog

Shrinking footprints of foreign banks in India

Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…

RBI rushes in to prop up falling rupee

RBI rushes in to prop up falling rupee India’s central bank reportedly intervened in the currency markets on Monday to prevent a further slide in the local unit, which breached the 67 mark to a dollar for the first time in 15 months amid a widening trade gap and runaway import bills fuelled by high crude-oil prices. Some state-owned banks were seen selling dollars aggressively, interventions that market dealers attributed to the central bank’s strategy to stem the decline of the Indian rupee against the US currency. The rupee is the worst performing among a dozen Asian monetary units in the past three months. It lost 4.25 per cent to the dollar during the period, show data from Bloomberg. On Monday, the Reserve Bank of India (RBI) is said to have sold about Rs 800 million collectively on the spot and exchange traded futures markets, dealers said. An email sent to RBI remained unanswered until the publication of this report. The currency market has seen such a strong central bank interven…

GST Refund of Rs 20,000 Cr Pending: Exporters’ Body

GST Refund of Rs  20,000 Cr Pending: Exporters’ Body Refund of over Rs 20,000 crore on account of Goods and Services Tax (GST) is pending with the government with more than half the amount stuck as input tax credit, Federation of Indian Export Organisations said on Tuesday. While claims over Rs7,000 crore were cleared in March, the amount was Rs 1,000 crore in April.However, after exporters’ request, the GST council and tax department are organizing a second phase of Special Refund Fortnight starting May 31, which will enable exporters to draw their refunds at a speedy pace. Many exporters have been unable to file the refund of input tax credit due to technical glitches, exports and claim happened in different months. The major challenge lies on ITC refund especially because the process is partly electronic and partly manual which is cumbersome and add to the transaction cost, the exporters’ body said. On IGST, refunds are getting delayed due to airline and shipping companies not submitt…