The exemption from GST on export freight was extended twice by the government after it was introduced in 2018 and the last extension ended on 30 September 2022 after a two-year run.
Exporters will have to pay GST of 18% on export freight if the exemption is not extended further, which would raise the logistics costs for Indian goods in the global market.
The date for GST exemption on Export related Ocean Freight and Air Freight has not been extended yet. As of now, it is taxable w.e.f. 1st October 2022, and if the exemption is not extended, this will increase Export freight cost by 18% for the Exporters. Until the GST exemption on exports is notified, exporters should pay it and take a refund through the ITC or IGST route.
The payment of GST on export freight and subsequent refund particularly through ITC mechanism comes with a time lag of 2-3 months or so, though refund through IGST mechanism is faster.
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