Treatment of Imports in GST

Import GST for importers shall bring bonanza! Read as under: to know how

As GST will subsume Countervailing Duty(CVD) and Special Additional Duty (SAD), however Basic Customs Duty (BCD) will continue to levy in the import bills.

Below are some GST implications under import:-

Import will be like an Inter-State Supply – Import into India will be considered as Inter-State supply and accordingly will attract IGST tax along with Basic Custom Duty and other surcharges. The person in whose name Bill of Entry is made shall be getting clearance of goods & accordingly he is liable to avail credit of IGST.

Import of Services – In GST any services which are received from outside India, the tax liability arising from such transaction will be on the Service Recipient. This is similar to the current provision of reverse charge, wherein service receiver is required to pay tax and file return & then only can claim that as Input.

Transaction value based valuation-Under GST, liability of GST in maximum cases will be determined based on the transaction value.

The transaction value


a)Taxes charged under other Law

b)Any amount for which supplier is liable to pay Incidental expenses Interest or late fees. (This is to be notified more, to be continue… )

c)Any taxes, duties, cess, fees & charges levied under any other law, If charged separately by the supplier to the recipient . (Though it is tough to determine practically what else has been charged beyond invoice).


CGST/IGST/SGST/UTGST/Compensation Act.

Refund of Duty: Under the new law, IGST paid during import will be available as a credit, which means credit benefit of SAD & CVD will be available now to all. While at present refund of SAD is only allowed.

High Sea Sales:  In present tax structure, high sea sales is exempt. As per proposed GST model no such exemption would be available and each supply would be liable to tax.

Which means that now the person who will be taking clearance of goods will have to pay,

Firstly, the duties of BCD & IGST at custom port

Secondly, IGST involvement due to transaction b/w buyer & seller on high sea sales.

That will lead to double taxation, therefore we believe that there will be some exemptions expected here going on wards. (To be continue…)


The levy of taxes and treatment of taxes in case of imports and exports largely remain the same under GST in comparison with the existing laws.

In case of an importer, full input credit will be available on the IGST paid on imports and additional input credit will be available on the GST paid on all types of inputs used or intended to be used in the course of or for the furtherance of business.

Similarly, in the case of an exporter, refund will be given on the tax paid on all inputs used in the course of business.

Hence, overall costs of import and export are expected to reduce under GST and compliance is expected to become easier with the convergence of multiple tax laws into one law.

Cheers! GST would decrease the cost of imports due to free flow of credit chain.


Implication of GST on Imports

Written by:

Poonam Kanwar

(GST Associate)