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Imports under GST

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Under the GST regime, import of goods or services shall be deemed to be inter-state supplies and would be subject to Integrated tax.

While IGST on import of services would be leviable under the IGST Act, the levy of the IGST on import of goods would be levied under the Customs Act, 1962 read with the Custom Tariff Act, 1975.

Import of goods under GST

As per section 2(10) of IGST Act, "Import of goods" means bringing goods into India from a place outside India. Section 7(2) further provides that supply of goods imported into the territory of India, till they cross the customs frontiers of India, shall be treated to be a supply of goods in the course of inter-State trade or commerce.

Levy of Integrated Tax (IGST)

IGST shall be levied on goods imported into India in accordance with the provisions of the Customs Tariff Act, 1975.

  • CVD (Countervailing Duty) and SAD (Special Additional Duty) on imported goods have been replaced by IGST wef 1-7-2017.
  • IGST on imported goods shall be levied in addition to the applicable Basic Customs Duty (BCD) and GST compensation cess.
  • The point of levy and collection of IGST is the point when the bill of entry for home consumption is filed.

Value of imported goods under GST

The value of imported goods for the purpose of levying Integrated tax shall be assessable value plus customs duty levied and any other duty chargeable on the said goods under any law for the time being in force.

The value of the imported article for the purpose of levying cess shall be assessable value plus basic customs duty levied under the Act, and any sum chargeable on said goods under any law for the time being in force. The integrated tax paid shall not be added to the value for the purpose of calculating cess.

GST registration for importer of goods

Importer of goods neither covered under reverse charge provisions nor specified under section 24 of CGST act for compulsory registration. However, it is mandatory for GST registered importers to quote the GST number in the bill of entry for payment of IGST and availing ITC of such IGST.

Import as passenger baggage

No IGST and compensation cess will be payable on passenger baggage. The basic customs duty at the rate of 35% and the applicable education cess shall be leviable on the value which is in excess of the duty-free allowances provided under the Baggage Rules, 2016.

Import of services under GST

Import of services refers to supply of any service where the

  • supplier is located outside India,
  • the recipient is located in India and
  • the place of supply of service is in India.

Import of services for consideration

As per section 7(1) (b) of CGST Act, 2017, import of services for a consideration whether or not in the course or furtherance of business shall be considered as a supply. For example, the import of free services from Google without any consideration is not considered a supply and would not be taxable.

Import of services from related person

Import of services by a person from a related person or from any of his other establishments outside India, in the course or furtherance of business is taxable even if without consideration - paragraph 4 of Schedule I of CGST Act

Thus, import of service from HO or branch outside India will be subject to GST even if no payment was made to HO or branch outside India.

GST registration for importer of services

As per section 24, it is compulsory to get registered under GST for a person, who is liable to pay tax under the reverse charge mechanism (RCM). Accordingly, the importer of services who are required to pay GST under reverse charge shall obtain compulsory registration.

Exemptions related to imports under GST

(i) Import of services by United Nations or a specified international organisation for official use of the United Nations or the specified international organisation - Sr No. 10G of Notification No. 9/2017-IT (Rate).

(ii) Import of services by Foreign diplomatic mission or consular post in India, or diplomatic agents or career consular officers posted therein - Sr No. 10H of Notification No. 9/2017-IT (Rate).

(iii) Import of services by Foreign diplomatic mission or consular post in India, or diplomatic agents or career consular officers posted therein - Sr No. 10H of Notification No. 9/2017-IT (Rate).

(iv) import of services under reverse charge if value of royalty and license fee was included in customs value of goods imported - Notification No. 6/2018-IT (Rate).


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TaxGyata Team

TaxGyata Team