Commerce Ministry for keeping imports of capital goods used for exports out of GST ambit

New Delhi, Jan 4 (KNN) Commerce and Industry Ministry has urged the Finance Ministry to keep imports of capital goods which are used for exports out of the GST ambit.

The GST Council held its eighth meeting in the national capital on Tuesday.

According to a media report, Commerce Minister Nirmala Sitharaman said her ministry has also requested the finance ministry to keep out of the GST ambit the imports of capital goods which are used as input for exports.

This includes import of raw material under the Advance Authorisation scheme and import of capital goods under Export Promotion Capital Goods authorisation scheme.

The request is made keeping in view that the exporters would first have to pay taxes and then seek refund later which takes 6 to 8 months.

The Ministry has also asked for tax concessions for leather, plantation and service export sectors like tourism, hospitality and health besides products moving between SEZs in the proposed goods and services tax.

Sitharaman said the Ministry has asked for leather goods to be taxed at less than 5% along with a lower tax on cement which currently faces levy of upto 30% in some cases.

She said a lower tax rate is important looking at the country’s infrastructural needs and government’s housing-for-all initiative.

The ministry has also pitched to keep plantations like coffee out of indirect tax ambit or be taxed at a low rate because “these are net foreign exchange earners which need to be given support.”

Further, the ministry has also sought lowering of import duty on gold in the Union Budget.