GST- Export to Nepal Bhutan – Critical Questions Answered

GST (Goods and Services Tax) is a comprehensive tax system implemented in India on 1st July 2017. The GST Council governs GST in India and its regulations for export and import of goods are strictly followed by businesses. If you are an Indian business owner, planning to export goods to Nepal and Bhutan, there are certain critical questions that you need answers to.

1. What is GST on export of goods to Nepal and Bhutan?

Export of goods to Nepal and Bhutan is considered as an inter-state supply and is exempt from payment of Integrated Goods and Services Tax (IGST). However, you need to register for GST and obtain an Export General Manifest (EGM) from Customs before exporting goods to Nepal and Bhutan.

2. What are the documents required for export of goods to Nepal and Bhutan?

The following documents are required for export of goods to Nepal and Bhutan:

1. Export Invoice

2. Packing List

3. Bill of Lading/Airway Bill

4. Export General Manifest (EGM)

5. Customs Declaration Form

6. Commercial Invoice cum Packing List (for Nepal only)

3. Do I need to pay any taxes other than GST on export of goods to Nepal and Bhutan?

Export of goods to Nepal and Bhutan is exempt from payment of IGST. However, you need to pay basic customs duty (BCD) and cess (if applicable) on export of goods to Nepal and Bhutan. The rate of BCD and cess varies based on the goods exported.

4. What is the procedure for claiming refund of GST on export of goods to Nepal and Bhutan?

If you are an exporter of goods to Nepal and Bhutan, you can claim refund of GST paid on inputs used in the manufacture of exported goods. You need to file a refund application in FORM GST RFD-01A on the GST portal. You also need to submit the proof of export of goods, such as shipping bill, bill of export or e-way bill.

5. What are the penalties for non-compliance of GST regulations for export of goods to Nepal and Bhutan?

If you fail to comply with the GST regulations for export of goods to Nepal and Bhutan, you may be liable to penalties and interest. The penalties may range from a minimum of Rs. 10,000 to a maximum of Rs. 25,000.

In conclusion, if you are planning to export goods to Nepal and Bhutan, it is important to follow the GST regulations and obtain the necessary documents. You should also be aware of the taxes applicable on export of goods and the procedure for claiming refund of GST. Non-compliance of GST regulations can result in penalties and interest.