The Centre is expected to provide GST relief to Infosys, international shipping companies and foreign airlines, as per media reports on. A news report mentioned that the government is planning to modify the June circular during the upcoming GST council meeting, to be held on 9 September.
The report said that the Centre recognises the need for greater clarity in the Goods and Services Tax (GST) regime for the service sector, as well as enhanced ease of doing business.
This acknowledgement comes at a time when the Directorate General of Goods and Services Tax Intelligence (DGGI) has recently issued show-cause notices to several prominent entities, including India's second-largest IT company and multiple foreign airlines. These notices were related to unpaid taxes on the import of services by Indian branches from their head offices, highlighting the ongoing complexities and ambiguities within the current GST framework.
The government's focus on addressing these issues aims to streamline GST compliance, reduce confusion and foster a more conducive business environment, particularly for service-orientated industries.
On 6 August, the DGGI sent notices to ten foreign airlines, including British Airways and Lufthansa, for allegedly failing to pay Rs 10,000 crore in taxes related to unpaid duties on services imported by Indian branches from their parent companies. The 54th GST Council Meeting is anticipated to address tax slab reductions and rate adjustments, as well as eliminate duty inversion under GST.
Following the 23 June meeting, Union Finance Minister Nirmala Sitharaman stated that the Group of Ministers, led by Bihar's Deputy Chief Minister Sumant Chaudhary, would present the status of their work at the next GST Council meeting.
There is ongoing speculation about relaxing the 'related party transaction' clause under GST for foreign entities in India.
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