The Central Board of Indirect Taxes and Customs (CBIC) on the recommendation of the 55th GST Council Meet has notified the conditions for availing benefit of reducing rate of compensation cess to 0.1% on supplies to merchant exporters.
The Board has notified to reduce the rate of Compensation Cess to 0.1% on supplies to merchant exporters at par with GST rate on supplies subject to various conditions.
Firstly, the registered supplier shall supply the goods to the registered recipient on a tax invoice.
Secondly, the registered recipient shall export the said goods within a period of ninety days from the date of issue of a tax invoice by the registered supplier.
Thirdly, the registered recipient shall indicate the Goods and Services Tax Identification Number of the registered supplier and the tax invoice number issued by the registered supplier in respect of the said goods in the shipping bill or bill of export, as the case may be.
Fourthly, the registered recipient shall be registered with an Export Promotion Council or a Commodity Board recognized by the Department of Commerce.
Fifthly, the registered recipient shall place an order on registered supplier for procuring goods at concessional rate and a copy of the same shall also be provided to the jurisdictional tax officer of the registered supplier.
Sixthly, the registered recipient shall move the goods from place of registered supplier directly to the Port, Inland Container Deport, Airport or Land Customs Station from where the said goods are to be exported; or directly to a registered warehouse from where the said goods shall be move to the Port, Inland Container Deport, Airport or Land Customs Station from where the said goods are to be exported.
Sevently, if the registered recipient intends to aggregate supplies from multiple registered suppliers and then export, the goods from each registered supplier shall move to a registered warehouse and after aggregation, the registered recipient shall move goods to the Port, Inland Container Deport, Airport or Land Customs Station from where they shall be exported.
Eighthly, in case of situation referred to in condition (vii), the registered recipient shall endorse receipt of goods on the tax invoice and also obtain acknowledgement of receipt of goods in the registered warehouse from the warehouse operator and the endorsed tax invoice and the acknowledgment of the warehouse operator shall be provided to the registered supplier as well as to the jurisdictional tax officer of such supplier; and
Lastly, when goods have been exported, the registered recipient shall provide copy of shipping bill or bill of export containing details of Goods and Services Tax Identification Number (GSTIN) and tax invoice of the registered supplier along with proof of export general manifest or export report having been filed to the registered supplier as well as jurisdictional tax officer of such supplier.
Notification Details
Notification No. 01/2025-Compensation Cess (Rate)
Date: 16/0/2025
