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Relief for exporters: Govt considering ways to speed up refunds
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SME Times News Bureau | 23 Sep, 2017
With exporters complaining of their working capital being blocked under
the GST regime, the Finance Ministry on Friday said that it was
considering ways, including manual clearance, to speed up refunds.
The
exporters' refunds have been pending as they can be processed only
after November 10, the deadline to file GSTR 3, which is a combination
of sales and purchases.
"Lot of people are speculating that the
refund for inputs in case of exports under Goods and Services Tax (GST)
will be available only when regular form GSTR 3 is filed for every
month. This is not the case.
"We are trying to find a way of
giving refund by linking form GSTR 1 with form GSTR 3B and therefore,
for the month of July, where form GSTR 1 is already filed, the
authorities would be in a position to process the refund applications,"
the Finance Ministry said in a statement.
The ministry advised
the exporters, who have not yet filed form GSTR 1 for July to file it
immediately and not to wait till the deadline (October 10).
"GST
Network (GSTN) application for refund is also getting ready. But, in
the meantime, we are also finding other ways of giving refund, if
necessary through a manual procedure," it said.
The government clarification came amidst reports of apprehensions about the blockage of working capital for exporters post-GST.
The
Committee on Export set up by the GST Council has discussed various
methods of resolving the issue of blockage of funds for the exporters,
it said.
"The Committee interacted with the exporters of eight
sectors who made detailed presentations on the problems being faced by
them. It is working on issues of exports sector and would present the
solution to their problems before the GST Council as soon as possible,"
the statement said.
In the meantime, the authorities of state
governments as well as the central government have been requested to
clear the pending refund claims of central excise and value-added tax
(VAT) for the pre-GST period, so that the exporters will get immediate
relief, the ministry stated.
Moreover, it said that in respect of
66 per cent value of exports, exporters have preferred the duty
drawback scheme instead of taking actual refund of input taxes in the
pre-GST regime.
Duty drawback scheme was actually extended in
the post-GST regime for a period of three months, up to September 30,
subject to the exporter not taking input tax credit under GST.
"This means that as of now, for 66 per cent of the value of exports, there is no blockage of funds," it said.
The
Duty Drawback Scheme seeks to give rebate on the tax chargeable on
imported goods or input services used in the manufacture of export
goods.
The government said that the problem of blockage of
working capital is not as grievous as it is made out to be as the
remaining 33 per cent of exporters always used to prefer a normal refund
route for taxes paid on inputs for central excise separately and for
VAT separately and that was made available to them only after the actual
exports took place.
"For such class of exporters, earlier also
there was a normal blockage of funds for a period of five-six months at
least except for those using facility of advance authorisation," it
said.
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