Exporters can soon start claiming compensation for GST paid in August and September, as the GST Network (GSTN), the company handling IT infrastructure for the indirect tax regime, will launch an online application for processing of refunds this week.
Chief Executive Officer Prakash Kumar said on Monday GSTN had from October 10 started issuing refunds to exporters for the Integrated GST (IGST) they paid for July, after matching GSTR-3B and GSTR-1.
For August and September, while the initial return GSTR-3B has already been filed, the final return GSTR-1 has not yet been filed. “A separate online app for claiming Integrated GST refunds for August and September would be made available on GSTN portal this week,” Kumar told PTI.
In the app, exporters can save and upload their sales data which are part of GSTR-1 after filling export details in Table 6A. The table will be then extracted separately and after exporters digitally sign it, it will automatically go to the customs department.
The customs department will then validate the information provided in the table, with the shipping bill data and also the taxes paid in GSTR-3B. The refund amount will be either credited to exporter’s bank account through ECS or a cheque will be issued.
As per data, 55.87 lakh GSTR-3B returns were filed for July, 51.37 lakh for August and over 42 lakh for September. Preliminary returns GSTR-3B for a month is filed on the 20th day of the next month after paying due taxes. Thereafter, final returns in form GSTR-1, 2, 3 are filed by businesses giving invoice-wise details of sales. The final return filing for August and September has not started yet.
Over July-August, an estimated Rs 67,000 crore has accumulated as Integrated GST (IGST), of which only about Rs 5,000-10,000 crore will be due as refunds to exporters. The GST does not provide for an exemption, and so exporters are required to first pay IGST on manufactured goods and claim refunds after exporting them. This has put severe liquidity crunch, particularly on aggregators or merchant exporters.
To ease their problems, the GST Council earlier this month decided a package for them, which includes extending the Advance Authorisation / Export Promotion Capital Goods (EPCG)/100 per cent EOU (Export Oriented Unit) schemes to sourcing inputs from abroad as well as domestic suppliers until March 31, thus not requiring to pay IGST.
The government is aiming to clear pending GST refunds of exporters by November-end. The first cheque after processing of July refunds was issued on October 10.