GST - FTP Statement - Foreign Trade Policy 2015-20

The deadline fixed for Goods and Services tax as announced in Budget 2015 is 1^st April, 2016. The same was noted in FTP statement issued for Foreign Trade policy 2015-20. The relevant extract is as below:

       1)    One of Domestic Challenges - Goods and Services Tax (GST)

In the absence of a uniform system of indirect taxation in India, exporters are often unable to get a rebate or drawback on all indirect taxes paid on the exported product and the inputs that went into its production, significantly inflating the final price of the exported product and making it less price competitive.

The GST which is to be implemented from 1 April 2016 is expected to help Indian exporters significantly. The simplification and harmonization of the indirect tax regime of the country will reduce the cost of production and lead to a seamless, integrated Indian market, thereby making Indian trade and industry                                                                                                                                        

2)    Goals and Objectives

To accomplish the objectives of FTP 2015-20, it is necessary to implement a uniform, rational tax structure which can be in the form of GST.

Goods and Services Tax expected to harmonize indirect taxation and reduce exporters' production costs under FTP The Foreign Trade Policy 2015-20 identifies the absence of a uniform indirect tax regime as a constraint on exporters and records implementation of GST from 1 April 2016 as the principal measure to simplify and harmonise indirect taxation, reduce production costs, integrate the domestic market, and enhance exporters' price competitiveness.