The 53rd Goods and Services Tax ( GST ) Council Meeting has concluded with many decisions, among which two major changes were proposed to the existing GST laws on Special Economic Zones ( SEZ ).
The Council has recommended a retrospective exemption from compensation cess leviable on the imports in Special Economic Zones ( SEZ ) by an SEZ Unit or Developer for authorised operations.
The GST Council proposed the exemption for all imports to SEZ from the inception of Goods and Services Tax, from 01 July, 2017.
In addition, the council has also proposed an amendment in Section 16 of IGST Act and Section 54 of the Central Goods and Services Tax Act to curtail refund of Integrated Goods and Services Tax (IGST) in cases where export duty is payable.
The Council recommended amendments in section 16 of IGST Act and section 54 of CGST Act to provide that the refund in respect of goods, which are subjected to export duty, is restricted, irrespective of whether the said goods are exported without payment of taxes or with payment of taxes, and such restrictions should also be applicable, if such goods are supplied to a SEZ developer or a SEZ unit for authorised operations.
By this, the government is proposing changes to tax laws to limit refunds for exporters who also pay export duties. This applies regardless of whether the exporter paid taxes upfront or not. The restrictions would also extend to situations where the goods are supplied to a Special Economic Zone ( SEZ ) for permitted activities.
Further, among other changes, the council has also recommended providing a new optional facility by way of FORM GSTR-1A to facilitate the taxpayers to amend the details in FORM GSTR-1 for a tax period and/ or to declare additional details, if any, before filing of return in FORM GSTR-3B for the said tax period.
This will facilitate taxpayer to add any particulars of supply of the current tax period missed out in reporting in FORM GSTR-1 of the said tax period or to amend any particulars already declared in FORM GSTR-1 of the current tax period ( including those declared in IFF, for the first and second months of a quarter, if any, for quarterly taxpayers ), to ensure that correct liability is auto-populated in FORM GSTR-3B.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
