Inverted Duty Structure in GST: Is Your ITC Refund Expiring?
If you manufacture Pharma, Footwear, Textile, Corrugated Boxes, or Steel Utensils in India — the government may owe you lakhs of rupees right now. It's called an Inverted Duty Structure (IDS) refund. Most manufacturers have never filed a single claim. WHAT IS INVERTED DUTY STRUCTURE? When GST on your raw materials is HIGHER than GST on your finished product — that difference gets permanently stuck in your GST ledger every month. Example: A footwear manufacturer buys leather at 12% GST but sells finished shoes at 5%. That 7% difference = blocked ITC every month. WHO IS AFFECTED? → Pharma Manufacturers (API 18% → Medicine 5%) → Footwear Manufacturers (Leather 12-18% → Shoes 5%) → Textile Manufacturers (Yarn 12% → Garments 5%) → Corrugated Box Industry (Paper 18% → Box 12%) → Steel Utensils (Metal 18% → Utensils 12%) → EV Manufacturers (Components 18% → EV 5%) HOW MUCH CAN YOU RECOVER? → Pharma (₹10Cr turnover) = up to ₹1.05 Crore → Footwear (₹10Cr turno...