Reforms soothe exporters' anxieties

The rationalisation of goods and services tax (GST) rates and simplification of procedures will lower costs, address duty-related distortions, result in faster refunds, ease liquidity pressures, and boost competitiveness for exporters across sectors.

- SHIVA RAJORA & SHREYA NANDI

The measures announced on Wednesday have come at a time when the US has imposed a steep 50 per cent tariff on several Indian-origin products.

The removal of the value threshold for GST refunds will significantly benefit small and ecommerce exporters by making even low-value shipments eligible for refunds. This will improve cash flow, reduce working capital constraints, simplify compliance, and streamline refund procedures, particularly for consignments shipped via courier or postal services. Small sellers will benefit and low-value ecommerce exports will grow.

The GST Council lowered the rate for paper packaging, textiles, leather, and wood to 5 per cent from 12-18 per cent. This will lower production costs and enable exporters to offer more competitive prices.