Proposed GST changes could release most eligible refunds after risk-based scrutiny and clarify export treatment for cross-border services, improving cash flow for logistics and other exporters.
India’s Goods and Services Tax Council is weighing a set of changes that could make it easier for service exporters to claim refunds and more clearly qualify overseas work as exports, a move that would be particularly significant for logistics, freight and other cross-border service businesses. According to a press release cited by CargoTalk, the draft framework would allow 90% of eligible refunds to be released at the outset after risk-based scrutiny, with the remainder paid once checks are completed. The aim is to improve cash flow by shortening the wait for tax recovered on export-related costs.
Moneycontrol reported that the proposal would also broaden the definition of services exports, including some cases in which Indian firms bill foreign clients through overseas branches and other work carried out in India for overseas customers. That change could remove uncertainty for companies whose operations are spread across jurisdictions, while aligning the treatment of export receipts more closely with Reserve Bank of India rules.
The refund package under discussion is also meant to cover services and equipment, which many exporters say are among their main costs. Business Standard reported in September that the Council had already backed a risk-based system under which 90% of refund claims for zero-rated supplies could be processed provisionally, with the balance paid after verification. That wider reform, due to take effect on November 1, 2025, was designed to speed up refunds for exporters and firms affected by inverted duty structures, where tax paid on inputs exceeds tax collected on output.
Taken together, the proposals point to a broader effort to make the GST system less cumbersome for exporters of services, especially businesses that rely on steady working capital to fund overseas contracts. Industry commentary on the GST regime suggests the changes could also help clarify treatment for intermediaries and other cross-border service arrangements, which have long been a source of dispute and delay.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
