Export for Paid Samples

[Arun Kumar]

My products have high development cost but low material cost. For Ex. If customer wants a size or O ring, he is ok to pay high development cost for 10 pcs. If O Ring cost id ₹ 10 each, the development cost would be ₹ 2500.

I would like to know as my products fall under 28% tax slab, will it be necessary to pay 28% tax in invoice as it will be sent as sample shipment (value less than INR 20,000)?

I believe it is necessary to export through shipping bill to get refund of tax, but for sample shipment, will it be 28% tax applicable as invoice value will be less than INR20,000??

[Kishan Barai]

Yes you will get refund of IGST paid at the time of purchase of goods, refund is not on your sales price , not GST would be lavied on your sales price for Exports.

AI Summary

Export taxation: IGST refund applies to input tax paid, not to the sales invoice for exported samples.
The supplier asked whether paid exported samples with high development costs but low material cost must carry GST at the applicable high rate on the invoice when the consignment value is below the sample threshold and whether export/shipping documentation is needed to claim relief. The reply states that IGST refund applies to tax paid on purchases (inputs) used in the exported samples and that such refunds relate to input tax, not the seller's sales price, further indicating that GST is not levied on export sales and procedural export documentation enables input tax refund claims.