Government to review GST impact on projects

Government to review GST impact on projects

"There has been across the board increase of 2 percent in existing MEIS incentive for exports by MSMEs/labour-intensive industries involving additional incentive of Rs 4,567 crore", the policy statement said.

Chaudhary further said that the government is focused on maintaining the share in traditional export markets such as European Union, the USA as well as the focus will be on exploring new markets.

Director General of Foreign Trade, Alok Chaturvedi, released the mid-term review of the FTP. An E-wallet will be launched from April 1 next year and a team of experts will be set up to assist exporters on GST issues.

In April 201, the government had announced several incentives in the five-year FTP for exporters and units in the special economic zones (EPZs) to almost double India's exports of goods and services to $900 billion by 2020.

The revised FTP focuses on exploring new markets and products, as well as increasing the country's share in traditional markets, leveraging the benefits of GST, increasing ease of trading across borders and increasing farmers' income through a focused policy for agricultural exports. However, the commerce ministry delayed the review in a bid to comprehend the impact of the new tax regime on the business of the exporters.

"Mid-term review of the Foreign Trade Policy 2015-20 contains several positive features".

A sharp fall in export of items such as readymade garments, gems and jewellery and leather products has resulted in a 1.2 percent year on year decline in exports of merchandise in October to $23.09 billion.

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"Government should gradually extend the MEIS to other sectors of exports since they are also facing numerous challenges in exports".

The increase in annual incentive by 34 per cent to Rs 8,450 crore will benefit leather, handicraft, carpets, sports goods, agriculture, marine, electronic components and project exports, the minister said in a tweet.

The government is also focused on transparency as well as trust with the industry and maintaining worldwide quality standards to succeed in the global market, he added.

Validity period of Duty Free Credit Scrips has already been increased from 18 to 24 months to enhance their utility in the GST framework.

On the administrative side, the GST Council has resolved the problem of blockage of working capital even as the refund of ITC and IGST refunds for exporters are being expedited.

Under the self-certification scheme for duty-free imports, instead of getting a ratification of the Norms Committee for inputs to be used in the manufacture of export products, exporters will self-certify that requirement and take an authorization from the DGFT.