GST Refund Fortnight Scheme: Third Session From 16th July to 30th July 2018

GST Refund Fortnight is a scheme by the GST council to address refund issues related to the exporters in India. The third session of the GST refund fortnight scheme would be observed from 16.07.2018 to 31.07.2018 to deal exclusively with pending GST Refund Claims (IGST & ITC).

The Central Board of Indirect Taxes and Customs (CBIC) is set to organize the third edition of special fortnight scheme from 16th – 30th July 2018 in order to clear all the pending GST refunds of the exporters.

Accounting back the previous 2-fortnight schemes organized by the CBIC, the Central Board of Indirect Taxes and Customs-cleared a total amount of INR 5401 crores in the first-fortnight scheme while INR 7635 crores in the second fortnight.

The pending refund was due to the Integrated GST i.e. IGST paid and the remaining ITC claims of the exporters. Note that the CBIC had already cleared 90 per cent of the refund claims.

According to the official notification, “In order to liquidate pendency further, and to handhold/ guide the trade for applying for the refund claims in a proper manner, it has been decided to observe another refund fortnight from July 16 to 30, 2018. Dedicated refund cells and helpdesks will be provided for exporters to get their refund claims process, in each Commissionerate”.

The section 54 of the GST allows for the refund of any excess GST paid. There a number of circumstances under which GST Refunds can be claimed. Export of Goods and Services is one such instance. However, delay in GST refunds has severely hit exporters. Some GST refunds have been pending since last eight months. Exporters complain that they are now stranded with a small working capital for running their business operations. To address such export grievances the GST council has brought the GST Refund Fortnight scheme.

A major part of the refund amount due to technical glitches remains alien from the cash flow dependent economy. The revenue department reasons that forms submitted by some specific exporters to the customs department were not consistent with that of the GSTN. The implication of such a delay can be very extreme for some exporters. GST was supposed to be India’s simple and good tax.

Read Also: Official Goods and Services Tax Refund Procedure: All You Need to Know

However, even after one year down the line, Exporters are still stranded by the inefficiency of the System/Governance. An interest rate of 6% was promised on the refund amount for delays greater than 60 days. In this article, we throw light on the GST Refund Fortnight third session which is being observed by the CBEC from 16th July to 30th July 2018.

IGST (Integrated Goods and Services Tax) Refund

After protests from the exporter, the GST Council is finally paying heed to their grievances. Accordingly, Exporters with IGST refund or Input Tax credit claim pending with the CBEC must visit their field offices. The respective Tax officials in charge of the facility will then help them with the refund process. The Tax officials will be responsible for refunds with following issues:

• Mismatch in invoice filed either with Customs or that with GSTN
• Errors associated with the filing of Export General Manifest in gateway port

ITC (Input Tax Credit) Refund

For Input Tax Credit refund, exporters need to follow below simple steps:

• An exporter must first fill the RFD-01 A form on the GST portal
• Take the Print out of the form as well as all the supporting documentation to the respective Juridical Tax Officer
• The Commissioner for Central and State Tax has issued the order for the refund to the Jurisdictional Tax Officer. Exports will not have to file separate refunds for CGST and SGST
• Exporter refunds will not be processed until the print out of the Exporter Form GST RFD-01A is submitted

Recommended: List of Goods and Services Not Eligible for Input Tax Credit Refund

Special Refund Cells

All customs department during the fortnight will be equipped with dedicated manpower and apt infrastructure to ensure a smooth and accelerated refund sanctioning process.

The customs department has been given the service of ICEGATE so that it can check the status of the refund itself. Even exporters can also know the status of the shipping bill by logging on this link https://www.icegate.gov.in/.

E-wallet Scheme for Exporters

The GST Council is also looking for digital options for refund transactions for which the e-wallet scheme is said to be under discussion. The Government would transfer notional/non-existing credits to the exporter’s account. The amount would be determined by the GST Council based on the exporter’s previous records. The users of the e-wallet or the exporters can use the predetermined virtual credit to pay off taxes on input.

If the proposed GST Fortnight Scheme is implemented successfully it would be a major boost for those exporters whose business operations have been most affected by the temporary halt in the refund process.