GST overhaul: Export status for contract manufacturing to boost supply-chain shifts to India

The monthly refund of tax paid on plant and machinery for five years, the removal of structural and procedural inefficiencies, and the release of credit blockages will unlock working capital for businesses putting up new lines. Additionally, treating contract manufacturing for foreign principals as an export will give a fillip to manufacturers relocating parts of their supply chains. This decision places Indian processing or assembly operations on the same tax footing as their competitors elsewhere.

GST reforms treating contract manufacturing for foreign principals as exports could boost India’s appeal as companies relocate parts of their supply chains. Expanded refunds covering input services and capital goods, faster 90% refunds and measures to release blocked tax credits are also expected to unlock working capital and support investment.

Summarised by Agaah from Economic Times. Agaah aggregates 36 sources and removes duplicate coverage — all news, one place.