Calcutta, July 14: Freight brokers in Calcutta hope that the system of raising brokerage payment bills with shipping lines under the goods and services tax regime will be revised soon.

Under the new tax regime, freight brokers will be considered service providers and will have to raise bills for shipping companies with the appropriate amount of the GST.

"As service providers, we are subject to the GST rules and have to adhere to timely submission of monthly returns and payment of the GST to the government. Of course, shipping companies shall get input tax credit on the GST paid to us. We request all shipping companies to formulate the procedure of brokerage bills submission by the brokers," said Rajiv Agarwall, chairman of the Calcutta Freight Brokers Association, at its 79th annual general meeting.

As service providers, an 18 per cent GST will be applicable to brokers and unless the system is in place, it may dent their earnings.

Members of the association said the issue is being discussed with all shipping lines and the procedures are expected to be formalised soon.

"Initially, there were problems with procedural issues as GST was rolled out from July 1. There were problems in generating shipping bills. But a lot of these issues have eased now," Agarwall said.

"We hope the GST will bring in benefits in the long run," former CFBA chairman Bharat Jain said and added that the levy of a 5 per cent GST on ocean freight could lock up working capital of exporters. Exporters also need more clarity on GST treatment on the export of SEZ cargo.

Agarwall said despite Calcutta port's strong position in terms of handling of container traffic, infrastructure constraints still remain a concern. "If the authorities do not take up the task of developing a deep sea port, the shippers will be forced to look for opportunities elsewhere, affecting trade traffic at the port," he said.