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Reduction in Basic Customs Duty in Budget 2023 - does your business benefit?
Reduction in Basic Customs Duty in Budget 2023 - does your business benefit?
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Reduction in Basic Customs Duty in Budget 2023 - does your business benefit?. In the Budget announcement for financial year 2023-24, the government has reduced import duty, also known as customs duty on several products. Other than this, there is simplification in the customs tariff regime by bringing down the number of rates to 13. In this article, Compliance Calendar lists out categories of products, raw materials and businesses which benefit from such reduced customs duty. What is customs duty and who needs to pay it? ⇒ Customs duty in India is a type of indirect tax that is levied on goods that are imported into the country or exported out of the country. ⇒ It is a source of revenue for the government and is collected by the Department of Revenue under the Ministry of Finance. ⇒ Customs duty is generally levied as a percentage of the value of the goods that are being imported or exported. The rate of customs duty varies depending on the type of goods and the country of origin/destination. In addition to the basic customs duty, there may be additional duties and taxes such as countervailing duty, special additional duty, and cess. ⇒ The person who is liable to pay customs duty in India depends on the type of import or export. Generally, it is the importer in India who is responsible for paying the customs duty. However, in certain cases, the customs duty may be paid by the buyer or seller, or a third party such as a shipping agent or customs broker. ⇒ The customs duty in India is payable via the ICEGATE website. Items on which customs duty has been lowered in Budget 2023-24 » Promoting blue economy - fish, shrimps and aquaculture: The government has aimed to give a boost to marine products and the blue economy, by reducing basic customs duty on the following products: Fish lipid oil, algal prime (flour) - reduced to 15% Fish meal and krill meal - reduced to 5% Minerals and vitamin premixes - reduced to 5% Fish feed - reduced to 5% » Powering tech-revolution in India: In order to promote the manufacturing of electronic items, such as mobile phones and television sets: Lowering of basic customs duty on mobile phone components, such as camera lens for camera modules made nil Exemption to capital goods imported for the manufacture of lithium-ion batteries for use in electric vehicles, mobile phones Open cells of TV panels - reduced to 2.5% » Electrical appliances and vehicles: Heat coils used in kitchen chimneys - reduced to 15% Automobile parts, vehicles imported for the purpose of testing - reduced to Nil » Precious metals & diamonds: Basic customs duty on Gold Bars & Gold Dores, Platinum - reduced to 10% Nil basic customs duty extended to seeds used in manufacturing of lab grown diamonds » Chemicals and Petrochemicals Basic customs duty on denatured ethyl alcohol - reduced to Nil Basic custom duty on acid grade fluorspar - reduced to 2.5% Crude glycerin - reduced to 2.5% What advantages would a reduction in basic customs duty bring? » Lower prices: Reduction in basic customs duty can lead to lower prices of imported goods. This can benefit consumers, as they can enjoy a wider variety of products at more affordable prices. With items like gold and platinum seeing a reduced basic customs duty, the overall price (after accounting for IGST) for customer, reduces. » Increased competition: Lowering basic customs duty increases the overall competition in the market, as foreign companies can now offer their products at more competitive prices. This can lead to better quality and more innovative products being available to consumers. A potent example is how the opening of the automobile sector in the 1990s to foreign players has made choices for Indian consumers more vibrant. » Boost to exports: Lowering basic customs duty can make Indian products more competitive in international markets, as they become more profitable. Marine products are a large part of India’s exports and thus, lowering duties in fish meal, shrimp, etc could boost their demand due to lower prices. » Attracting foreign investment: A reduction in basic customs duty can make India an attractive destination for foreign investors, as they can now import their products or raw materials at a lower cost. As investors and entrepreneurs look for diversifying supply chains and reducing dependence on China, this can lead to more foreign investment coming into India, which can have a positive impact on the economy. ¶ Bonus Points: It is important to note that customs duty is not applicable to all goods, and there are certain exemptions and concessions available for certain types of goods under certain circumstances. The Customs Act, of 1962, and various rules and regulations provide more information on customs duty in India. Connect with our tax experts at Compliance Calendar to get the best-tailored advice on managing customs tax for your specific business.
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Increase Authorised Capital
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Increase LLP Capital
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Alteration in MoA & AoA
Resignation of Auditor
Appointment of Director
Resignation of Director
Change in Designation of Director
Shifting Registered Office of Company
Shifting Registered Office of LLP
Dormant Status of Company
Mandatory Compliances
Appoinment of Auditor
Annual Filings of Company
Annual Filings of LLP
Annual DIN/DPIN KYC
Annual Return of Deposits
Half Yearly MSME Return
Statutory Registers & Minutes
XBRL Filing of Companies
eStamping of Share Certificates
Dematerialisation of Shares
RBI FEMA Compliance
GST Returns Filing
ESI-EPF Returns Filing
TDS Returns Filing
Change in Structure
Proprietorship to OPC
OPC to Private Limited
Private Limited to OPC
LLP to Private Limited
Private Limited to LLP
Partnership Firm to LLP
Private Limited to Public Company
Public Company to Private Limited
Trust/Society to Section 8 Company
Existing Company to Section 8
Existing Section 8 to Company
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Accounting & Book Keeping
GST Compliance
Valuation Services
Corporate Litigation
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ISO 9001:2015
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ISO 13485:2016
OHSAS 18001:2007
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ISO 22000:2005
ISO 27001:2013
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