Now, No GST At Duty-Free Shops At Airports; But There’s A Catch!

Income Tax Department has decided to abolish GST or Goods and Services Tax from all duty-free shops at airports.


No GST At Duty-Free Shops

In a major decision, Income Tax Department has decided to abolish GST or Goods and Services Tax from all duty-free shops at airports.

But will Indians get benefitted from this exemption?

Read on to know more!

No GST At Duty-Free Shops At Airports

Income Tax Dept. has officially removed all GST charges from duty-free shops in airports, all across the country.

However, this tax relief is only applicable for international tourists, who are entering or leaving India.

A copy of their passport shall be retained by the shop-owners of these duty-free shops, which can be used for input tax credit during filing of GST.

Hence, international tourists are no longer required to pay GST at these shops now.

How Will It Work?

Under under Section 2(5) of the IGST Act, 2017, or ‘zero-rated supply’ under Section 2(23) and Section 16(1) of the IGST Act,2017, these duty-free shops cannot be categorized as export houses, since their shops are located inside India, and the products are being bought inside India.

This is the reason that export duty and GST cannot be made applicable to these duty-free shops.

One of the tax officials said,

“The position of the revenue department has always been that we cannot export our taxes. We will issue clarification stating that duty free shops would not levy GST,”

An earlier notification by Authority for Advance Ruling (AAR) had put these duty-free shops in a fix, as they were supposed to pay GST under the new tax regime.

But earlier as well, duty-free shops were exempted from Central Sales Tax (CST) and Value-Added Tax (VAT), and now, the same has been continued.

Deregistered Companies Pay Rs 24,000 Crore GST!

Meanwhile, due to relentless push against black money, Corporate Affairs Ministry has informed that Rs 24,000 crore tax has been collected from 73,000 deregistered companies, since last year.

Probe against such benami and shell companies are still on, as Govt. is leaving no stone unturned to ensure that black money is caught.

The Serious Fraud Investigation Office (SFIO) is investigating 19 firms, while Registrar of Companies (RoC) is investigating 49 companies.

We will keep you updated, as we receive more information about black money, and tax collection.

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