In a significant move aimed at boosting tourism and aligning with global practices, the GST Council on Monday announced steps towards refunding Goods and Services Tax (GST) to foreign tourists purchasing goods in India to take back to their home countries. This initiative mirrors the tax refund systems offered to international travellers by several nations.
Revenue Secretary Sanjay Malhotra explained that the introduction of voluntary B2C e-invoicing will play a key role in implementing the refund system. "When foreign tourists purchase goods in India and take them abroad, it's considered an export. With this system, customs officials at airports can verify that the items were bought locally, making them eligible for a GST refund," Malhotra stated.
This initiative is also seen as a measure to curb tax evasion. The validation of e-invoices by consumers will add an extra layer of transparency to the purchasing process, ensuring that transactions are recorded accurately. The system will also empower consumers by allowing them to confirm the authenticity of their invoices.
GST authorities will develop a dedicated portal for e-invoice generation, ensuring that the details seamlessly integrate into the GST return system after verification. "This process not only benefits consumers but also assists us in facilitating refunds," Malhotra added.
The initiative is expected to enhance India’s appeal as a shopping destination for international tourists while improving transparency in tax administration.
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