1. Meeting with Commerce & Industry Minister Exports issues after GST

2. Duty Drawback not available for IGST
Drawback limited to incidence of duties of Customs on inputs used and remnant Central Excise Duty on specified petroleum products used for generation of captive power for manufacture or processing of export goods
Drawback does not cover GST or compensation cess paid on input, input services or capital goods
No upfront exemption for procurements for exports
High impact and disruption for small / unregistered exporters (for GST) and composition dealers
Registration under normal scheme mandatory with attendant compliance requirements
No credit nor refund nor duty drawback otherwise available to them of GST on the inputs, input services or capital goods
Drawback may be allowed for unregistered exporters and composition dealers without requirement for registration (normal)

3. Refund module not enabled in GSTN
Refund provisions not enabled in GSTN
GST drawback not allowed – only refund of GST paid or rebate of GST on inputs allowed
No GST exemption for procurements for exports
Heavy and indefinite blockage of working capital of exporters in GST paid by them
ITC refund only upon grant of credit which is linked to filing of returns
So technically refund enablement will also require return modules to be enabled

4. Deemed Exports not notified
‘Deemed Exports’ are to be notified under section 147 of the CGST Act, 2017
No notification issued so far
As per Explanation to section 54, ‘refund’ includes refund of tax on the supply of goods regarded as deemed exports
Provisional refund provisions available to zero-rated supplies also to be extended to deemed exports
Deemed exports to be treated at par with supplies to SEZs

5. Benefits curtailed under Duty Credit Scrips
Benefits under Advance authorization scheme, EPCG scheme and duty credit scrips such as MEIS and SEIS restricted only to Basic Customs Duty, Safeguard Duty, Transitional Product Specific Safeguard Duty and Anti-dumping Duty.
CVD exemption available only for items specified in the Fourth Schedule to the Central Excise Act, 1944 (specified petroleum products, tobacco etc.)
No exemption from IGST / GST under the said Schemes. IGST is required to be paid.
High impact on service exporters and software exporters who import capital goods
Software companies primarily import capital goods such as servers, computers and networking devices,
No refund of IGST nor utilization possible in respect of their capital goods’ imports

6. GST v. SEZs Compulsory registration of SEZ mandated for GST
4/25/2018
GST v. SEZs
Compulsory registration of SEZ mandated for GST
Reverse charge liability of SEZs on procurements from DTA not waived. Utilisation of ITC may be difficult and refund provisions not clear.
Special fiscal provisions applicable to SEZs to be extended to cover GST by amendment to the SEZ Act
GST Council has decided that Integrated GST (IGST) on high sea sale (s) transactions of imported goods, whether one or multiple, shall be levied and collected only at the time of importation. A similar dispensation may be extended to similar transactions in Special Economic Zones (SEZs).
Copyright (c) Lakshmikumaran & Sridharan / Confidential.

7. EOUs v. SEZs EOU is like any other normal supplier under GST
Registration and all other provisions of the GST Law apply with no exception
Only benefit of Basic Customs Duty exemption on imports to continue
Deeming fiction of job-work as service under GST will mean DTA clearances of goods will also be subject to restrictions as applicable for services
EOUs may either be treated at par with SEZ units or at least notified under Deemed Exports

8. Thank you