INVERTED RULESRESTORE OLD GST NORMS ON INVERTED DUTY

摘要

The Goods and Service Tax law was introduced with the intent to remove cascading effects of various taxes and to have free flow of input tax credits. True to its intent, enabling provisions were also incorporated in the GST legislation wherein refundof accumulated credit on account of inverted duty is permitted unlike Excise Duty/Service Tax legislations. Inverted duty structure means the scenario wherein the inward supplies are being taxed at a higher rate than the outward supplies. Such imbal-ancing tax structure results into accumulation of tax credits in the hands of the tax payers with no clear foreseen usage. Such issues of the erstwhile regime have been addressed in GST legislation and the manner of determination of eligible amount of refund on account of inverted duty structure has been prescribed.