GST Council Introduces Risk-Based Provisional Refunds for Zero-Rated Supplies from November 2025

Last updated: 04 September 2025

Save Share

Quick Summary

The GST Council has approved a new risk-based system for provisional refunds on zero-rated supplies, set to launch on 1st November 2025. Under this reform, eligible exporters and SEZ suppliers will receive 90% of their refund claims upfront, based on automated risk assessment. This aims to significantly improve cash flow for businesses and enhance the ease of doing business in India.

The 56th meeting of the GST Council was held in New Delhi under the chairpersonship of the Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman. The GST Council inter-alia made the recommendations relating to changes in GST tax rates, provide relief to individuals, common man, aspirational middle class and measures for facilitation of trade in GST.

The GST Council has approved a significant change to streamline refund processing for exporters and SEZ suppliers by recommending an amendment to Rule 91(2) of the CGST Rules, 2017. Under this reform, 90% of refund claims on account of zero-rated supplies will be sanctioned provisionally by the proper officer, based on risk identification and evaluation by the system.

The measure, set to be operationalized from 1st November 2025, will provide much-needed relief to exporters and suppliers to Special Economic Zone (SEZ) developers/units by ensuring faster access to working capital.

GST Council: Provisional Refunds for Exporters from Nov 2025

Key Features of the Reform

90% Provisional Refund: Eligible refund claimants for exports or SEZ supplies will receive most of their claim upfront.
Risk-Based Evaluation: Refunds will be sanctioned after automated risk checks, reducing chances of fraudulent claims.
Exceptions Allowed: In exceptional cases, where risk is high, the officer may withhold provisional sanction and conduct a detailed scrutiny, with reasons recorded in writing.
Exclusions by Notification: Certain categories of taxpayers may be excluded from this benefit through official notification.

Benefits for Exporters & SEZ Suppliers

Faster Refunds, Better Liquidity: Exporters and SEZ units will no longer face prolonged delays, easing working capital pressures.
Boost to Ease of Doing Business: Automated risk-based processing minimizes manual intervention and promotes transparency.
Encouragement to Exports: By aligning refunds with a streamlined risk-based approach, the move is expected to strengthen India's export competitiveness.
Consistency in Refund Framework: The system is in line with recent Council recommendations for risk-based refunds under the inverted duty structure.

Click here to view the complete Press Release of the 56th GST Council Meeting

FAQ :

The new system for provisional refunds on zero-rated supplies will be operationalised from 1st November 2025.

Eligible claimants will receive 90% of their refund claims on account of zero-rated supplies provisionally.

This reform is designed to benefit exporters and suppliers to Special Economic Zone (SEZ) developers and units.

Refunds will be sanctioned based on risk identification and evaluation by an automated system.

Yes, in cases of high risk, a proper officer may withhold provisional sanction and conduct detailed scrutiny, with reasons recorded in writing.

The key benefits include faster access to working capital for exporters and SEZ suppliers, a boost to the ease of doing business, and encouragement to exports through a streamlined process.

4491 Views Comment Share GST Report

News posted by

CCI News Desk

Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

Comments :