While the GST on DFS goods operates on different provisions, some challenges persist such as re-claiming the credit already reversed on supplies made from arrival terminal, and admissibility of refund for tax paid on input services procured domestically, etc.
Taxability on goods at duty-free shops has been a subject of scrutiny. Duty-free shops (DFS) are retail outlets located at departure and arrival areas of international airports. Since they offer goods cheaper than their market price, these retail outlets are wildly popular among consumers.
People shop for an array of products, from branded watches to liquors, and many other at these duty-free shops. The supply of goods from DFS, as the name suggests, appears to be free from taxes and levies.
Source economictimes
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