Exporter refunds worth Rs 25,000 crore stuck for GSTN lacuna: Mitra

“There have been three lakh applications from exporters of the country, involving Rs 25,000 crore, which are awaiting refunds,” Mitra, also a GST Council member, said here during an exports conclave, a part of the Bengal Global Business Summit 2019 roadshow.

The GSTN auto verifies refund claims, but it is unable to do so, and therefore, manual verification is relied upon that leads to huge pileup of applications and impacts the working capital of the exporters, the minister said. 

He said an average of only 35-40 per cent of these applications have come to states for manual verification, and the situation remains grim for West Bengal as well.

Mitra has been critical of the GST implementation in the past, too, accusing the Centre for its “hurried” introduction without adequate infrastructure, which has made the indirect tax system more “primitive” than the VAT regime. 

He also said that he will raise the issue with the GSTN.

Mitra had earlier assured the state’s exporters of some advance credit to partially tide over their crisis.

The Bengal minister said the state was aiming to double exports from the existing $ 9.15 billion, over the next three years. Towards this goal, it has decided to adopt measures to improve infrastructure for exporters at the district level. 

The WBIDC and MSME will work together to set up export facilitation centres at district headquarters, he said. 

Mitra added that steel, foundry, garments and leather are among a few focus sectors to push exports from the state.

The GST has resulted in greater formalisation of the Indian economy with over 6.5 lakh new assessees having sought registration under the new indirect tax regime, the government said.

A Finance Ministry release here said that this increased tax information flow would help to eventually boost both direct and indirect tax collections in the country. "In the past, the Centre had little data on small manufacturers and consumption because the excise was imposed only at the manufacturing stage, while the states had little data on the activities of local firms outside their borders," it said. 

"Under the GST, there will be now seamless flow of availability of common set of data to both the Centre and the States making Direct and Indirect Tax collections more effective." 

The Ministry reported "early signs of tax base expansion."  "Between June and July 2017, 6.6 lakh new agents, previously outside the tax net, sought GST registration. This is expected to rise consistently as the incentives for formalisation increase. Entire textile chain is now brought under tax net," it said. 

"Further, a segment of land and real estate transactions has also been brought into tax net 'works contracts'. Besides, formalisation will occur of cement, steel and other sales, which earlier tended to be outside the tax net, because builder will need documentation of these input purchases to claim tax credit," it added. 

The government also said more steps are being taken for further simplification of processes to facilitate tax payers and to extend benefits to customers.