Implementation of the Goods and Services Tax has limited the use of duty credit scrips by exporters as these can now be utilised only for payment of basic Customs duty and not IGST.
These scrips, a type of certificates that carry certain monetary value, are key export promotion incentives extended by the government to exporters under the foreign trade policy.
Earlier, manufacturing exporters who import raw material for the export purpose were allowed to utilise these scrips for payment of Customs, excise duty and service tax.
“The duty credit scrips cannot be used for payment of IGST (IntegratedGoods and Services Tax) and GST compensation cess in imports, and CGST, SGST, IGST and GST compensation cess for domestic procurement,” said the Directorate General of Foreign Trade in a trade notice.