10/05/2026
Indian exporters are collectively freezing crores in GST refunds — every single month.
And the worst part? There's a perfectly legal fix that most businesses have never used.
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Here's the math on a ₹2 crore/month export supply business:
❌ Paying 12% GST = ₹24 lakhs blocked monthly
✅ Using 0.1% GST route = ₹20,000 outflow monthly
That's nearly ₹2.85 CRORES freed up annually.
This isn't tax evasion.
This isn't a loophole.
It's Notification No. 40/2017 & 41/2017 — issued by the GST Council on 23rd October 2017 — specifically to protect export supply chains.
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The structure is simple:
Supplier → Merchant Exporter → Foreign Buyer
Instead of paying full GST and chasing refunds for months, the supplier charges 0.1% IGST (or 0.05% CGST + 0.05% SGST for intra-state) — and cash flow stays intact.
But it comes with strict conditions:
🔸 Export within 90 days of invoice — no exceptions
🔸 Shipping bill must mention supplier GSTIN + invoice number
🔸 Merchant exporter must hold valid EPC/Commodity Board registration
🔸 Purchase order copy to be filed with jurisdictional tax officer
🔸 Post-export EGM proof must reach both supplier and tax officer
Miss any one — and you owe full differential GST.
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I've put together a detailed guide with the complete 8-condition compliance checklist, real ₹ impact tables, common mistakes, and a step-by-step action plan.
📖 Read the full blog here → https://spiceofindian.com/gst-concessional-rate-for-merchant-exporters/
Save this post. Share it with your CA, your supplier, or any exporter in your network.
They'll thank you for it.
