GST Export Refund

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Exports have been the area of focus in all policy initiatives of the Government for more than 30 years. Now with the Make in India initiative, exports continue to enjoy this special treatment because exports should not be burdened with domestic taxes. On the other hand, GST demands that the input-output chain not be broken and exemptions have a tendency to break this chain. Zero-rated supply is the method by which the Government has approached to address all these important considerations.
The intention of government not to burden the export with tax could be achieved either by allowing not to charge tax on the exports of goods/services and claim the refund of input tax credits of taxes paid on inward supplies or by allowing the refund of tax charged on the exports made. Both these alternatives have been enabled in this section. Zero-rated supplies may be undertaken in either of the following ways:

The intention of government not to burden the export with tax could be achieved either by allowing not to charge tax on the exports of goods/services and claim the refund of input tax credits of taxes paid on inward supplies or by allowing the refund of tax charged on the exports made. Both these alternatives have been enabled in this section. Zero-rated supplies may be undertaken in either of the following ways.

Taxable person to avail input tax credit used in making outward supply of goods or service or both and make zero-rated supply-

1. Without any payment of IGST on such outward supply by executing LUT (Letter of Undertaking) or bond (dispensed off vide notification 37/2017-Central tax). Claim refund of input tax credit used in the outward supply.

2. Make payment of IGST on the outward supply by debiting ‘electronic credit ledger’ but without collecting this tax from the recipient. After completing the outward supply, claim refund of the IGST so debited (unjust enrichment having been duly satisfied).

Documents Required for Export Refund Under GST:

  • Copy Of Purchase Bill
  • Copy Of Sale Bill/ Export Invoice.
  • Copy Of Packing Bill
  • Copy Of Shipping Bill
  • Copy Of Bill Of Lading /Airway
  • Copy Of e-BRC
  • Export Exemption Certificate
  • Bank Statement
  • CA Certificate.
  • Affidavit To The Effect That Dealer Pertains To Ward And Has Not Claimed Refund From Central Government.
  • Undertaking/Indemenity Bond To The Effect That Dealer With Refund The Amount If Paid In Exceed.

FAQ- GST Export Refund

  • What are the benefits of GST in India?

    Many Indirect taxeslike VAT, Excise Duty, Service Tax, CST, Import- Export, Octroi, Luxury Tax and Entertainment Tax is now only require a GST registration. This will result in less compliances and help businesses to focus more into their business.

  • What are the GST Rates in India?

    The GST rate will depend on the type of goods and services. Currently, the slab rates are 5%, 12%, 18% and 28%. Gold and rough diamonds do not currently fall under GST and will be taxed at 3% and 0.25%.

  • When should a business apply for multiple GST registrations?

    If a business operates from more than one state, then a separate GST registration is required for each state. For instance, If a sweet vendor sells in Karnataka and Tamil Nadu, he has to apply for separate GST registration in Karnataka and TN respectively. A business with multiple business verticals in a state may obtain a separate registration for each business vertical.

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