DACAAI says GST paid on bad debtors must be reversed

The Domestic Air Cargo Agents Association of India (DACAAI) has urged the Centre to ensure that GST paid on invoices which have become bad debts must be returned to their accounts.

As per provisions under GST law, agents have to pay 18% GST on invoices upfront, but the Coronavirus pandemic and consequent lockdown have led to an increasing number of cases of bad debts. Since operations have come to a standstill, the DACAAI has not received payments for services provided to clients leading to huge losses for the association.

In a statement, the president of DACAAI, Amit Bajaj said most DACAAI agents are small and medium enterprises and are on the verge of closing down the business due to losses that occurred during the COVID-19 lockdown. Additionally, airlines have continued to demand advance payments even in this situation, restricting the movement of domestic air cargo. The DACAAI has urged that the Centre return the GST paid upfront and bring in a reform measure under which GST is charged only after payments are realised.