As per the IGST Law, supplies of goods and services to or by Special Economic Zone (SEZ) units or SEZ developers will be treated as inter-State supplies. As per the SEZ Act, supply of goods from SEZs are treated as import of goods into India. Accordingly Basic Customs Duty (BCD) & Integrated GST will be levied on such supplies from SEZ units and SEZ developers into DTA.
Supplies of goods and/or services to SEZ units or SEZ developers are to be treated as “zero rated supplies” and the SEZ developer or SEZ unit receiving such zero rated supplies will be given similar treatment as exports (please refer next question for details).
Draft Registration Rules make it mandatory for a SEZ unit or SEZ developer to obtain separate registration as a business vertical distinct from its other units located outside the SEZ.