Tourism boost: Govt mulls GST tax refund for foreign tourists at airports

The revenue department is working on a mechanism under which foreign tourists may soon get to claim GST refunds paid by them on local purchases at airports at the time of exit. To get GST refunds, foreign tourists have to purchase articles from big retailers at the airports while leaving the country. An official reportedly said that field offices have to be sensitised to provide refund of GST to the foreign tourists. "It has to be ensured that refunds are not claimed on the basis of fake invoices," PTI quoted an official as saying. 

The refund will be made on the basis of invoices from big retailers. "A provision for GST refund to tourists have been made in the GST law, but it is yet to be operational." the official said. The term 'tourist' as stated in the law is as a person not resident in India and enters the country for a stay of not more than six months for legitimate non-immigrant purposes, the report said. Tourist refund claims are a great inbound tourism marketing technique. Countries like Singapore and Australia have a robust system that connects refund agencies and retailers on a single platform. 

They offer tourists seamless and hassle-free experience. The disbursement of the tax refunds in these countries is a very smooth process. Countries like Australia, Germany and France, among others offer VAT or GST refund to foreign tourists subject to certain conditions. They have a minimum threshold amount that a tourist has to spend to avail tax refund advantage.  A foreign tourist has to spend at least Australian $300 (around Rs 15,000) for availing the tax benefit.