{"id":57547,"date":"2025-01-02T16:34:01","date_gmt":"2025-01-02T11:04:01","guid":{"rendered":"https:\/\/piceapp.com\/blogs\/?p=57547"},"modified":"2025-01-02T16:34:06","modified_gmt":"2025-01-02T11:04:06","slug":"epcg-scheme-gst-exemption","status":"publish","type":"post","link":"https:\/\/piceapp.com\/blogs\/epcg-scheme-gst-exemption\/","title":{"rendered":"Know About EPCG Scheme GST Exemption"},"content":{"rendered":"\n
Importers can avail the EPCG scheme GST exemption on the importation of capital goods. Such importers can utilise the imported capital goods to produce finished goods for export from India. This scheme allows importers to avail reduced customs duty or zero customs duty, facilitating improved cash flow<\/a> for businesses. Learn about this scheme in detail here.<\/p>\n\n\n\n The Export Promotion Capital Goods scheme aims to reduce customs duties on capital goods to zero. The government initiative through the Directorate General of Foreign Trade of India (DGFT) considers capital goods in pre-production and post-production stages.<\/p>\n\n\n\n Under this scheme, importers can import capital goods at concessional customs duty<\/a> rates. Further, the imported capital goods can be used for export and manufacturing. These imported capital goods are exempt from IGST & Compensation Cess under the GST regulations.<\/p>\n\n\n\n In meeting the export obligation, importers are allowed to produce goods without the need to pay customs duty. Notably, capital goods included are spare parts, dies, jigs, tools, fixtures, software, computer systems and moulds that importers need to produce items for export.<\/p>\n\n\n\n Exporters can avail the zero-duty EPCG scheme for electronic products. However, the export obligation applicable is 6 times the duty saved on the import of capital goods<\/a> under the EPCG scheme. This export obligation needs to be fulfilled in 6 years reckoned from the issue date of export promotion capital goods authorisation.<\/p>\n\n\n\n Import of capital goods under the EPCG scheme allows a concession of 3% duty for pre-production, production and post-production of goods for exporters supporting the domestic supply chain. It applies a 3% custom duty with an export obligation of 8 times the duty saved from the issue date of authorisation.<\/p>\n\n\n\n The capital goods considered include refurbished and reconditioned spares. In addition, importers can import second-hand capital goods provided there is no age restriction. If the realisation is in free foreign exchange, <\/a>the export obligation can be fulfilled by supplying ITA-1 items to DTA.<\/p>\n\n\n\n You can find the details of the EPCG scheme in Chapter 5 of India\u2019s Foreign Trade Policy and Procedures. This is available on the website of the Department of Commerce, Ministry of Commerce and Industry.<\/p>\n\n\n\nExport Promotion Capital Goods Scheme<\/strong><\/h2>\n\n\n\n

Export Promotion Capital Good<\/strong>s<\/h2>\n\n\n\n