Under
the new GST regime, both the imports and exports of goods and services
in India would be treated as the supply of goods or services within the
course of inter-state trade and commerce and they will attract IGST. Article
269-A of GST Act constitutionally mandates that the supply of goods or
services or both during import into the territory of India shall be
deemed to be a supply of goods in the course of inter-State trade or
commerce for levy of integrated tax.
The
integrated tax would be levied on any import of goods or services which
are deemed as inter-state supplies. While IGST on the import of
services would be leviable under the IGST Act, IGST on the import of
goods would be levied under the Customs Act, 1962 along with the Customs
Tariff Act, 1975.
The Model GST Law will
subsume Countervailing Duty (CVD) and Special Additional Duty (SAD),
while Basic Customs Duty will keep on doing its round in the import
bills. BCD has been kept outside the domain of GST and will be charged
according to the present law as it were.
Some Implications of GST on the Imports and Importers
Imports
into India under the new GST law will be considered as Inter-State
supply and as a result, it will fall under the taxation rate of
Integrated Goods and Services Tax (IGST) alongside BCD as well as other
extra charges.
Import of Services -
The model GST law grants the obligation of payment of tax on the
receiver of the service if the supplier of the services is from outside
India. This is like the arrangement of reverse charge, wherein the one
benefiting is required to pay tax and file the return.
Refund of Duty -
Tax paid under GST, on the import of goods or services will be
accessible as a credit under the Import and Sale model. Additionally,
refund of SAD or any such confinements is not set under GST.
Withdrawal of Current Exemptions -
The previous customs import tax was stacked with various exemption
notices which were probably going to be checked on and perhaps pulled
back or changed over into a refund component. Withdrawal of exemptions
or transforming them to refund instrument could essentially change the
engaging quality and suitability of a portion of the key plans under the
FTP like EOU, STP, advance approval and so on.
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