The decision to exempt small exporters from furnishing a bank guarantee for shipping goods and services will help in reducing transaction time and cost, India's export promotion body said.
Micro and small exporters will immensely benefited from this decision as they were struggling to get bank guarantees, the Federation of Indian Export Organisations (FIEO) said in a statement.
“This is a much needed simplification which will help in reducing transaction time and cost of exporters,” the statement said.
The finance ministry on Friday stated that the government has decided to exempt small exporters from furnishing bank guarantee for shipping goods and services.
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"We should gradually move towards e-LUT (Electronic Legal Undertaking) which can be furnished online so as to eliminate any physical interaction with the tax authorities," the Finance Ministry said.
Under the Goods and Services Tax (GST), an exporter can get exemption from payment of IGST if he submits bonds or LUTs.
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