India holds the 7th
place as one of the largest growing economies in the whole world. Trade is the
most important factor that leads to the growth of this country. Thus, it is crucial
to keep an eye on the trade routine in both domestic and international markets.
With the implementation and introduction of GST (Goods & Services Tax)
launched on 1st July 2017, there has been a change in the method of
business in India.
Goods
& Services Tax has an important impact on the foreign trade of the products
through the changes in the structure of taxation. In today’s blog, we’ll
discuss the impact of Import Duty After GST in India.
In the previous tax system, imports of the commodities were
subject to different import duties including countervailing duties of excise
and customs duty.
Now, after the reformed tax structure has been introduced, IGST
has replaced all the indirect taxes that were previously levied on import of
services and goods.
An overview of IGST
IGST stands on Integrated Goods & Services Tax. According to
section 11 of the IGST Act, if an importer says that he/she is located in
Maharashtra, the state tax component of the integrated tax shall add to the
Maharashtra state.
The import services in GST are taxable if it meets the following
conditions:
·
Supplier of the service is situated outside India.
·
Recipient of the service is located in India.
·
Location of supply is in India.
·
The supplier and recipient of service are not establishments of a
distinct person.
Look at the Current Situation of Import Duty After GST
All the taxes which are paid during the import is now present in
the form of credit in the new law “import and sale” model that was not present
in the pre-GST routine.
· The government of India might change the custom role and
international trade policy with different kinds of notifications for exemptions
like MEIS, duty drawback, EPCG, advanced authorization in order to support the
GST.
CVD was previously accused on the estimate of MRP principle. But,
now IGST will involve CVD and it will be charged on transaction value in the
GST routine.
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