The Export Promotion Council for EOUs and SEZs (EPCES) today urged the government to exempt special economic zones from Goods and Services Tax (GST) levies.
The issue was discussed at a workshop on GST impact on SEZs and export oriented united (EOUs) here. “During the workshop, it was unanimously decided that EPCES must request the central and state governments to provide exemption to SEZs from payment of CGST/SGST/IGST as there is no mechanism in SEZ Act for refund and it is also not a subsidy,” the EPCES said in a statement.
The exemptions which have been provided to SEZs today must be continued under the GST regime, it added. As per the mechanism in the GST, the SEZs and EOUs would have to pay taxes first on the supplies from domestic tariff area and would claim refund for the same.
It also said that the primary business of the zones are exports and the purchases done by the SEZs from domestic tariff area should be treated as exports.