Excise on imports should be reduced by 50%

Refund should be provided on all input services ie., both on the amount of cash ledger as well as credit ledger. Basically, our company is engaged in the textile business on the e-commerce platform and providing services. We are selling the finished goods like kurtis, kurtas, palazzos, suit sets and similar readymade garments under the category of 5 per cent and 12 per cent GST rate. And majorly all our inputs are also of the category of 5 per cent and 12 per cent.

Our sale through the online ecommerce portal attracts commission. This commission being a taxable supply attracts GST at the rate of 18 per cent and is classified as input service for us.

Such commission is a substantial cost for our business and on top of it the GST rate of 18 per cent is being levied on the same which is way higher than the GST rate of 5 per cent that is levied on our finished product.

Because of this GST rate difference, we always end up in accumulating the GST input at 18 per cent that has been charged by the online portals as the commission fees for selling through the e-commerce portal.

Circular No-79/53/2018- GST dated 31st December, 2018, Section 54(3) and Section 2(59) of the CGST Act the following prevails:

1. Inputs do not include input services or capital goods.

2. Clearly, the intent of Law is to not allow refund of tax paid on input services or capital goods as part of refund of unutilised input tax credit accumulated on account of inverted duty structure.

Hence, we want the amendment in this point of inverted duty structure.

(Meaning of inverted duty structure - This refers to a situation where the rate of tax on inputs purchased is more than the rate of tax on outward supplies. For e.g., Rate of input supply is 12 per cent and rate of output supply is 5 per cent. Refund in case of inverted duty structure under GST-A registered person may claim a refund of unutilised ITC on account of inverted duty structure at the end of any tax period where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies)

Flat GST per cent on fabric purchase and sale

The percentage of GST charged on the fabric purchase and sale should be streamlined to a single GST rate only. As of Now GST Rate on fabric is both 5 per cent and 12 per cent respectively.

CGTMSE scheme

The credit guarantee fund scheme for micro and small enterprises (MSEs) is currently providing the limit up to Rs 2 crore only to the MSME units. It should be amended so that the maximum benefits can be taken by the MSME units in order to streamline their businesses.

This should be amended as follows: Upto Rs 10 crore or 20 per cent of the net sales (whichever is less)

Promotion of make in India item

If make and made in India is to be promoted then duty or excise on import should be reduced by 50 per cent on raw materials and should be increased on ready-to-use finished goods, which can be exported, in short resulting in the promotion of 'Make in India' product.

(The author is Chairman and Managing Director at Nandani Creation)