New
Published on:
February 20, 2023
By
Paramita

Understanding GST on Import Clearances other than Port of Importation in India

Goods and Services Tax (GST) was introduced in India on July 1, 2017. It is a comprehensive tax system that replaced multiple indirect taxes such as excise duty, service tax, VAT, and others. The objective of GST is to create a uniform tax system and bring all goods and services under a single tax regime.

Import of goods into India is subject to custom duty, which is regulated by the Customs Act, 1962. The Central Board of Excise and Customs (CBEC) has issued a notification regarding the applicability of GST on goods imported into India.

Applicability of GST on Import Clearances other than Port of Importation

When goods are imported into India, GST is applicable at the port of importation. However, in some cases, the goods may be cleared at a place other than the port of importation. For example, if the goods are transported in a bonded truck from the port of importation to a warehouse, the clearance of the goods will take place at the warehouse.

In such cases, GST is applicable on the value of the goods at the time of clearance. The value of the goods is determined as per the Customs Valuation Rules. However, if the goods are re-imported after being exported, the value of the goods will be determined as per the Customs Valuation Rules read with the GST Rules.

It is important to note that the importer has to pay the custom duty at the time of importation, and GST is applicable on the value of the goods at the time of clearance. The importer can claim the input tax credit on the GST paid at the time of clearance.

Procedure of Import Clearance other than Port of Importation

The procedure of import clearance other than the port of importation is as follows:

1. The importer files a bill of entry with the customs department.

2. The customs department assesses the bill of entry and determines the value of the goods as per the Customs Valuation Rules.

3. The importer pays the custom duty at the port of importation.

4. The goods are transported to the warehouse or any other place of clearance.

5. The importer files a fresh bill of entry at the place of clearance.

6. The customs department assesses the bill of entry and determines the value of the goods as per the Customs Valuation Rules read with the GST Rules.

7. The importer pays the GST on the value of the goods at the time of clearance.

The importer can claim the input tax credit on the GST paid at the time of clearance.

Conclusion

GST on import clearances other than the port of importation is applicable on the value of the goods at the time of clearance. The importer has to pay the custom duty at the time of importation, and GST is applicable on the value of the goods at the time of clearance. The importer can claim the input tax credit on the GST paid at the time of clearance.

Suggestions



COCOA BEANS - GST RATES HSN CODE 1801
Impact of GST on Textile Industry: Key Changes and Challenges
Goods & Service Tax (GST): Analysis and Opinions

Updated on:
March 16, 2024