Summary: The Government of India, in its Frequently Asked Questions (FAQs) on reforms for enhancing export competitiveness issued on 9 October 2026, explained the proposed amendment to the place of supply provisions under Section 13 of the IGST Act, 2017. Presently, under Section 13(3)(a), services requiring goods to be physically made available to a supplier in India, such as testing, repair, research and development, and clinical trials, are treated as supplied at the location where the services are performed. Consequently, such services are considered supplied in India even when the recipient is located abroad and payment is received in foreign exchange, denying export and zero-rating benefits. The proposed omission of Section 13(3)(a) would bring these services under the default place of supply rule in Section 13(2), whereby the place of supply is determined by the location of the recipient. This reform is intended to improve export competitiveness by enabling qualifying Indian service providers to access export-related GST benefits.
Economy
Frequently Asked Questions (FAQs) in respect of reforms for enhancing export competitiveness
Posted On: 09 OCT 2026 5:05PM
| Sl. No | Questions | Answers |
|---|---|---|
| 1. | What amendment is being brought in the place of supply provisions under section 13 of the IGST Act? | For services requiring goods to be made physically available to the supplier in India for the provision of service (e.g., testing, repair, R&D, clinical trials), place of supply is considered as the location of performance of services, i.e. in India as per provisions of section 13(3)(a) of the IGST Act, 2017, denying export/zero-rating benefit even though the recipient is abroad and payment is received in foreign exchange. Omission of clause (a) of section 13(3) will bring such services under the default rule of section 13(2), i.e., place of supply as the location of the recipient. |
