Export Air/Ocean Freight Component Of A Multimodal Transportation Contract - Retrospective Exemption

The taxability of services of transportation of goods has undergone a series of rapid changes in the short period since the introduction of the Goods and Services Tax in India. Under the erstwhile service tax regime, services of transportation of goods from India to a foreign territory i.e. export freight were not taxable since the place of provision of such services was outside India. However, such services are now exigible to tax under GST. Subsequent to representations regarding increased burden of tax incidence leading to increase in overall export costs, Notification No. 2/2018-CT(R) was issued with effect from 25th January, 2018 to exempt export air freight and export ocean freight with a sunset clause, which was later extended up to 30th September, 2019.