In a move that will bring cheers to exporters, the government today said it was working on a system to automatically transfer service tax refunds in their accounts.
"We are at a very advanced stage of preparing a software which would provide refunds of service tax to exporters automatically, based on [pattern of] duty drawback. We would come out with it in the next 15-20 days," VK Garg, Joint Secretary in Central Board of Excise and Customs (CBEC), said at a PHD Chamber event here.
Currently, the duty drawback is directly credited to accounts of exporters maintained at customs houses, but exporters have to file claims separately to get service tax refunds. Exporters complain that many a times there are unusual delay in refund of the levy.
Welcoming the move, Federation of Indian Export Organisations (FIEO) Director General Ajay Sahai said exporters would now get a faster refund of service tax.
"It will not only speed up the disbursement, but also reduce cost for exporters," he said.
FIEO is the apex body of Indian exporters.
Speaking at the PHD Chamber event, Garg also said that the CBEC was getting feedback on the draft "negative list" for service tax and another concept paper would be released next month after scrutinising the comments.
"We might come out with a fresh and improvised concept paper on the negative list of services post September 30, once the feedback arrives," he said.
Government levies the tax on limited number of services, but the ambit would increase significantly once the proposed Goods and Services Tax (GST) becomes operational.
The Finance Ministry recently released a draft paper on negative list of services. The negative list approach means that the services that are not included in it would be taxed.
Services like social welfare activities by NGOs, sale and purchase of securities, transportation by metered taxis and pre-school education, are in the draft negative list.
"The draft negative list is not cast in stone...There is no guarantee it will not increase," Garg added.
The new list, being prepared by the Finance Ministry, would be broad-based as it would take into account feedbacks, he added.
The government proposes to collect about Rs 82,000 crore from service tax this fiscal.
