Tax Bifergation on deemed export

[sanjay khatri]

Dear Expert, on deemed export if goods are sold is within state then what shoud i charged on nvoice 0.1% IGST or 0.05% CGST and SGST or 0.1% CGST?

[Rajagopalan Ranganathan]

Sir,

Whether it is export or deemed export it will be treated as inter-state supply and IGST rate of 0.1% rate is applicable. This is in respect of when supply is made by the supplier directly to the recipient without any intermediary in between. If you supply the goods to a merchant exporter who is located within the same state then 0.05% of CGST and 0.05% of SGST will be applicable. If the merchant exporter is located in other state then IGST @ 0.1% is applicable. This is my view.

[Ganeshan Kalyani]

Refer Notification No. 40/2017-Central Tax (Rate).

[ANITA BHADRA]

Sir

Small doubt :- If exporter sales goods , should not it be zero rated ?

1% rate is for mercantile exporter , means a trader sales goods to exporter . Or in other words , purchase of exporter will be 1% and export ( sale) will be zero rated .

Experts are requested to correct me , if I am wrong

Regards

CA Anita Bhadra

[Nash Industries I Pvt Ltd]

Dear Querist

The query needs to be clear.

If the supplies are to advance authorisation holders or to EPCG license holders or to EOU , it is a deemed export.

Supplies to EOU or manufacturers holding AA or EPCG will be on payment of applicable GST. The refund of GST can be either by the supplier or the recipient.

The applicable GST means IGST or CGST+SGST as the case may be.

The rate of 0.1% is to a merchant exporter and not to manufacturer exporter.

Regards

S.Ramaswamy

AI Summary

Deemed export GST treatment: inter-state supplies attract IGST; merchant exporter supplies may attract CGST and SGST. Deemed exports are taxable and treated as inter state supplies attracting IGST when made directly to the recipient; supplies to a merchant exporter within the same state attract CGST and SGST, while merchant exporters in another state attract IGST. Supplies to Advance Authorization, EPCG or EOU holders are deemed exports subject to payment of applicable GST with refund available to supplier or recipient. The concessional rate discussed applies to merchant exporters rather than manufacturer exporters and Notification No. 40/2017 Central Tax (Rate) was referenced.