The Centre may have to make necessary changes in legislations relating to SEZ (Special Economic Zone) and foreign trade to make them compliant with the Goods and Services Tax (GST) regime, the Union Commerce Secretary, Rita A Teaotia, said here on Friday.
Considered to be the country’s biggest-ever indirect tax reform, the GST framework has already been passed by Parliament.
“Suitable changes will have to be made in the SEZ and Foreign Trade Acts to make them compliant with the GST. Many DGFT schemes will also have to be moderated as well,” she said on the sidelines of an event organised by the Confederation of Indian Industry (CII).
According to her, the government has engaged some legal experts to study the implications of GST on exports.
She further added that the Centre was committed to zero-rating of exports post implementation of GST.
GST a game-changer
Calling GST a “game-changer”, Teaotia said post its implementation, the cost of locally manufactured goods will also go down.
Logistics cost too will go down as companies often opt for multi-location warehouses to save on the multiple taxes between Centre and states; while movement of goods is expected to be faster.
The proposed tax regime would lead to a “one to 1.5 per cent” increase in GDP every year.
“Services will also get a boost. We will work together with the department of revenue to address all of them,’’ she added.