Q1 How are exports treated under GST?
Both export and import are governed under the IGST Act. Exports are treated as zero rated supply under IGST.
Q 2 How will imports be taxed under GST?
All imports will be deemed as inter-State supplies for the purposes of levy of GST. IGST is leviable on imports in addition to other duties of customs. Full set-off will be available as ITC of the IGST paid on import on goods and services.
Q 3 How many types of GST will be levied on different kinds of supply of goods or services?
GST is a dual levy to be simultaneously levied by both Centre and State.
- On every supply within a State/ Union Territory without legislature (intra-State supply), GST levied will have two components - Central Tax and State Tax/ Union Territory Tax popularly called CGST and SGST/UTGST.
- On every supply across States (inter-State), Integrated Tax popularly called IGST will be levied.
The rate of CGST and SGST/UTGST would be equal. IGST would be levied at a rate equal to the sum total of CGST and SGST/UTGST.
Q 4 Is GST going to increase compliance burden on the trade?
No. On the contrary GST will result in streamlining of processes and reduction of compliance burden. GST is a simple tax which uniformly applies across the country. GST has been designed to have minimal human interface and would be implemented through strong IT platform run by GSTN. Also, in the earlier regime there were multiple compliances required for taxes such as Central Excise, Service tax, VAT etc. with Centre and State. GST makes it single and uniform compliance for indirect taxes across the country.
Q 5 In which State will a person be registered?
A person liable to be registered has to apply for registration in each State from where he makes or intends to make outward supplies under GST. Within each State, generally only one registration is required to be obtained.
Q 6 What do you mean by zero rated supply?
It means that output supply would be exempted while input ITC would be refunded on the exported goods.
Q 7 Is a job worker required to take registration?
As job work is a service, it would be considered a supply and the job worker would be required to obtain registration if his aggregate turnover exceeds the prescribed threshold of Rs.20 lakhs or, as the case may be, Rs.10 Lakhs.
Q 8 What are the options available to exporters under GST?
Exporter has to furnish LUT on Letterhead in the format specified in RFD 11.
Furnish in duplicate, on the Letterhead, signed by authorized person, for a financial year in an annexure to form RFD 11 to the jurisdictional Deputy Commissioner/ Assistant Commissioner.
The exporter is at liberty to furnish to Central/ State tax authority.
Q 9 Who is eligible for LUT/Bond?
All exporters are eligible for LUT, as per Circular no. 8/8/2017- GST dated 4/10/2017, subject to conditions stipulated therein.
Q 10 How do you file Shipping Bill after GST? Are there any charges?
Exporter has to mention the GSTN Number on the Shipping Bill and the State Code at the Master level as well as appropriately mention their IGST payment status i.e., exports with/ without payment of IGST.
Q 11 What kind of invoice is required for exports?
There is no specific format of invoice prescribed for exports. However, it is important that certain information is given in the invoice so as to get refund of tax paid on goods or unutilized input tax credit. Please ensure that the following information is available in the invoice :-
a. name, address and GSTIN of the exporter;
b. a consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters, hyphen or dash and slash symbolized as “-” and “/” respectively, and any combination thereof, unique for a financial year;
c. date of its issue;
d. HSN code of goods or Accounting Code of services; description of goods or services;
e. quantity in case of goods and unit or Unique Quantity Code thereof;
f. total value of supply of goods or services or both;
g. rate of tax (integrated tax);
h. amount of tax charged in respect of taxable goods or services (integrated tax);
i. place of supply along with the name of State;
j. signature or digital signature of the supplier or his authorized representative;
k. The invoice shall carry an endorsement “SUPPLY MEANT FOR EXPORT ON PAYMENT OF IGST” or “SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF IGST”, as the case may be, and shall contain the following details:
i. name and address of the recipient;
ii. address of delivery;
iii. name of the country of destination; and
Q 12 Will export of goods to Nepal and Bhutan treated as zero rated and thereby qualify for all the benefits available to zero rated supplies under the GST regime?
Export of goods to Nepal or Bhutan fulfils the condition of GST Law regarding taking goods out of India. Hence, export of goods to Nepal and Bhutan will be treated as zero rated and consequently will also qualify for all the benefits available to zero rated supplies under the GST regime. However, the definition of ‘export of services’ in the GST Law requires that the payment for such services should have been received by the supplier of services in convertible foreign exchange.