The government is yet to invoke provisions of the Integrated Goods and Services Tax Act that allow foreign tourists in India to claim GST refunds on items they buy and take back home, the Union Finance Ministry said on Monday. The ministry, in a Right to Information query filed by PTI, was asked to give details on procedures for foreigners to get GST refunds on goods purchased by them in the country.

In its reply, the Central Board of Indirect Taxes and Customs said, “Please note that Section 15 of the IGST (Integrated Goods and Services Tax) [Act] has not yet been enforced. Therefore the reply of this office is nil information currently.”

The Act lays out provisions for levying and collecting taxes on inter-state supply of goods or services, or both, by the central government. Section 15 of the Act says that the integrated tax paid by a tourist leaving India, on any supply of goods taken out of the country by him, will be “refunded in such manner and subject to such conditions and safeguards as may be prescribed”, PTI reported.

Sandeep Chilana, a lawyer who specialises in taxation, told PTI that the government should come out with terms, conditions, and safeguards for refunds of GST paid by foreign tourists. “GST is a consumption-based tax,” he said. “In case the goods are purchased in India and taken by the tourist outside India, it should be seen as export and necessary refund should be available.”

He said that a refund provision would motivate more international travellers to come to India. “It will encourage them to spend more money in India,” said Chilana. “It will promote tourism in the country and help in generating foreign exchange from the tourists.”