Import

Custom Duty on Import in India

Custom Duty on Import in India

The concept of import duty is very wide and is almost applicable to every product or item imported to India barring a few goods.

 

Basic duty

Basic Duty is a type of duty or tax imposed under the Customs Act (1962). Basic Customs Duty varies for different items from 5% to 40%. The duty rates are mentioned in the First Schedule of the Customs Tariff Act, 1975 and have been amended from time to time under the Finance Act. The duty may be fixed on ad –valorem basis or specific rate basis.

However, after the genesis of Goods and Services Taxations system in India, there would be no impact on levy of Basic Customs duty, Education Cess, Anti-dumping duty, Safeguard duty and the like. However, the Additional duties of Customs, which are in common parlance referred to as Countervailing Duty (CVD) and Special Additional duty of Customs (SAD), would be replaced with the levy of Integrated Goods and Services Tax (IGST), barring a few exceptions.

  • Additional customs

Additional duty also known as countervailing duty or C.V.D is equal to excise duty imposed on a like product manufactured or produced in India.

  • Special additional duty

Special Additional Duty of Customs is imposed at a certain rate in order to provide a level playing field to indigenous goods which have to bear sales tax. This duty is to computed on the aggregate of –

  1. assessable value;
  2. basic duty of Customs;
  • surcharge; and
  1. additional duty of Customs leviable under section 3 of the Customs Tariff Act, 1975 (c.v.d.)
  • Anti-Dumping Duty

Dumping means exporting goods in a foreign market at a price which is less than their cost of production or below their “fair” market value. Dumping gives a hard competition to a domestic goods manufacturer. So, to counteract this dumping, the Indian government has formulated certain guidelines and policies. Imposing duty on imported goods is also one of them and is known as Anti-Dumping Duty.

All the laws related to anti-dumping duties are mention in the sections 9A, 9B and 9C of the Indian Customs Tariff Act (1975), and the Indian Customs Tariff Rules (1995). These laws are based on the Agreement on Anti-Dumping which is in pursuance of Article VI of GATT 1994.

 

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