The government has refuted exporters’ claim that Rs. 20,000 crore of goods and services tax (GST) refund is pending, and said there has been no dip in refunds as it announced a special refund fortnight beginning May 31.
“Refund claims to the tune of Rs. 7,000 crore- Rs. 14,000 crore on the IGST side, and Rs. 7,000 crore on account of ITCNSE -0.78 %, are pending with the government as on date, as against the figure of Rs. 20,000 crore projected by FIEO in the press reports,” the government said in a statement.
The Federation of Indian Export Organisations (FIEO) had on Tuesday raised the issue of refunds claiming a slowdown and Rs. 20,000 dues.
The government admitted that refunds of goods and services tax (GST) have been a concern for both itself and trade for the past several months, but so far Rs. 30,000 crore GST refund has been sanctioned — Rs. 16,000 crore of IGST and Rs. 14,000 crore of input tax credit. “Contrary to the press reports that there has been a dip in refund sanction after the first Refund Fortnight in March 2018, the refund sanctioned during May 2018 is to the tune of Rs. 8,000 crore,” it said.
A ‘Special Drive Refund Fortnight’ beginning May 31 been announced to clear the dues.
Government has asked those with pending refunds to approach their jurisdictional tax authority for disposal of any of their refund claims submitted on or before April 30 which are still pending.
The Central Board of Indirect Taxes and Customs (CBIC) is implementing a solution to process refunds held up in cases where exporters have mistakenly declared their export supplies as domestic supplies. A circular issued by the government on May 29 states that on receipt of the records from GSTN, the customs would automatically process the refunds for sanction, if no other errors are committed by exporters. A separate circular issued on May 30 relates to refund claims by input service distributor, composition dealer, exports of services and supplies made to special economic zones. The circular also clarifies issues related to requirement of letter of undertaking in cases of export of exempted or non-GST goods and scope of restriction imposed and also refunds of input tax credit relating to compensation.
“The circular for refund of IGST paid on exports allows refund even in case of mismatch of tax liability on exports of goods disclosed in GSTR 3B and GSTR 1. This is welcome development,” said Pratik Jain, indirect tax leader at PWC.