In this document we are going to briefly discuss about the conditions for procurement of goods at Concessional rate of GST for the purpose of Export.
Conditions to be qualify for concessional GST rate i.e. 0.1%: –
As per notification no 41/2017 – Integrated Tax rate following conditions should be fulfill for procuring goods GST rate @0.1%.
1. The recipient should be registered with an Export promotion Council or a Commodity Board recognized by the Department of Commerce herein after referred as Merchant Exporter (“ME”).
2. The supplier shall supply the goods to the registered merchant Exporter on Tax invoice.
3. The ME should export the goods within a period of ninety days (90 days) from the date of issue of a tax invoice by the supplier.
4. The ME should indicate the GSTIN of supplier and tax invoice number issued by the supplier of the said goods in shipping bill or bill of export.
5. The ME should indicate the GSTIN of supplier and tax invoice number issued by the supplier of the said goods in shipping bill or bill of export.
6. The ME shall move the said goods from the place of supplier:
a) Directly to the port; or
b) Directly to the registered warehouse from where the said goods shall be move to the port
7. In case of aggregate supplies from multiple suppliers and then export: –
The goods from the suppliers shall move to the registered warehouse and after aggregation the ME should move goods to the port or station from where the goods shall be exported.
8. In situation as referred in condition 7 – the ME shall endorse receipt of goods on the tax invoice and also the acknowledgement of receipt of goods in the registered warehouse from the warehouse operator. These should be provided to the supplier as well as to the jurisdictional tax officer of such supplier.
9. The copy of bill or bill of export containing details of GSTIN and Tax invoice Number of the Supplier along with proof of export general manifest or export report have to be submit to supplier as well as Jurisdictional office of Supplier.
Note –
The supplier will not be eligible for the above-mentioned conditions/exemptions if the recipient fails to export the said goods within a period of ninety days from the date of issue of tax invoice.
Example: –
If ABC Pvt Ltd (Exporter or Registered Recipient) fulfills all the above requirement/conditions then, it can procure goods from local suppliers at concessional GST rate of 0.1% for the purpose of export. Consequently, efforts of ABC in obtaining GST refund will get reduced substantially or ABC will not face issue of huge Input Tax Credit lying in the Credit Ledger.
Author: Ujala Gupta ([email protected])
Author Bio
Sir,
Can Merchant exporter buy goods by both method i.e. concessional rate of GST and full payment of GST during financial year ?
One purchase under concessional rate of GST and export of goods under LUT and second purchase of goods by paying GST as per applicable rate and export by paying tax during same financial year.
Hi… Experts having few doubt on concessional rate supply, Please answer if anyone knows.
one of the condition is If the merchant exporter fails to export within 90 days then supplier cannot avail 0.1% concessional rate, here i want to know the explanation for “supplier cannot avail 0.1% concessional rate” does is it mean that supplier have to pay 18% GST if merchant supplier fails to export within 90days ?
dear sir we are purchase goods 0.1% IGST AND EXPORT THE GOODS TO WITHIN 3 DAYS.ADD NAME TO SHIPPING BILL TO PURCHASE PARTY
BUT WE ARE EXPOTRT TO PAIN 18% IGST. BECASE INPUT IN OUR LADGER
PLS ASK
dear sir,
we would like to understand that as per gst law, what is the clarification and meaning of registered warehouse,
as many gst office informs that it doesnt mean the primary place of business nor additional place of warehouse..
for merchant exporters working under 0.1% they have to store good to registered warehouse meant for merchant exporters only, and they cant store in there owned warehouse which is mentioned on the additional place of gst registration.
please if you have any clarification on this matter or any circular please if you can send us or guide us on the same.
regards
ankit mehta
There is a strange request at Delhi Commissionerate that an intimation for supply of goods @ 0.10% should be given to the Local GST cell and an acknowledgement is sought for clearing the goods. This is not stated in the notification no 41/2017 – Integrated Tax rate
Request you to kindly clarify where the supplier GSTN and Invoice has to be mentioned in the Shipping Bill pls clarify under which feild
Sir,
If the quantity supplied is not exported fully and some quantity is still not exported
then what about Tax exemption
The proof of export submitted is eligible or not
can igst shipment in the case of supplier remove goods in confessional rate allowed
If Merchant Exporter places order to a Manufacturer and Manufacturer Subcontracts manufacturing of Some parts then concessional Rate of GST 0.1% is applicable on Billing to Merchant exporter only or Manufacturer can also get 0.1% Gst rate on all billings done by subcontractors.
SIr, if invoice no. or GSTN no. of the supplier is not mention in the Shipping Bill due to any reason
pl. advise
Dear Usha ji, & Anurag ji
The relaxation of lower rate will be a challenge. You may please contact with CHA and check for amendment if doable in shipping bill. I understand that direct answer to such situation is not available.
SIr, if invoice no. or GSTN no. of the supplier is not mention in the Shipping Bill due to any reson.
Please advise.
you can arrange shipping certificate from custom dept doing application on your letter head with vendor invoice details.
Further, my client will also give sub contract to other vendor for this job. Can He get procure @ 0.10%
reference for above question: Can Job worker supplied his job work service @ 0.10% to Merchant exporter. Exporter buys a raw material and supplies to my client for job work. after completion of Jobwork my client deliver goods to principal. Can we supply @ 0.10% rate.
Dear Nikhil ji,
To my understanding the relaxation is available only for the “Goods”.
Can Job worker supplied his job work service @ 0.10% to Merchant exporter. Exporter buys a raw material and supplies to my client for job work. after completion of Jobwork my client deliver goods to principal. Can we supply @ 0.10% rate.