India's GST (Goods and Services Tax) system affects how exporters price their products and how importers are invoiced. Understanding the basics helps you negotiate better.
GST on Exports
Exports from India are 'zero-rated' — meaning no GST is charged on exported goods. This is a benefit to importers because the supplier doesn't add 18% GST to your invoice.
How It Works in Practice
When an Indian supplier exports, they can claim refunds on the GST they paid on raw materials and inputs. This means export prices are lower than domestic prices. However, the supplier needs to complete proper export documentation to claim these refunds.
Impact on Your Pricing
If a supplier quotes you a price 'plus GST,' that's not a good sign for exports. Export prices should be GST-free. If GST is being added to your export invoice, ask the supplier to handle their export documentation properly.
Your Customs Responsibilities
While the Indian supplier doesn't charge GST on exports, you'll still need to pay import duties and taxes in your own country. These are separate from Indian GST.
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