| OverviewThis functionality is specific for India. Custom duty is levied on goods that are imported at the rate,
specified in the Customs Tariff Act. The objectives of imposing the custom duties are as
follows: - To raise revenue for the central government.
- To regulate imports and exports.
- To protect Indian industries from foreign products.
Types of Custom duties Basic custom duty The duty levied on goods imported to India. The duty is
calculated on the Assessable value. Example, 12.5% on assessable value. Education Cess on Customs The duty levied on basic custom duty to generate revenue for
basic education in the country. Example, 2% on Customs. Secondary and Higher Education Cess on Customs The duty levied on basic custom duty to generate revenue for
secondary and higher education in the country. Example, 2% on
Customs. Countervailing Duty (aka CVD) or Additional Custom duty The duty levied on imported goods, equal to the excise duty
amount levied on the goods manufactured in India. The main purpose of this duty
is to make the imported goods more expensive and to reduce the competitive
advantage over the local products. The duty is payable on assessable value plus
basic customs duty. If the product is covered under MRP(maximum retail price)
provisions, then duty is payable on MRP. Example 16.32%
(including education cess) . Education Cess on CVD The duty levied on countervailing duty to generate revenue for
basic education in the country. Example 2% on CVD. Secondary and Higher Education Cess on CVD The duty levied on countervailing duty to generate revenue for
secondary and higher education in the country. Example 1% on
CVD. Additional Duty of Customs The duty levied on the aggregate of the following
values: - Assessable value
- Basic custom duty
- Additional customs duty or Countervailing duty
The duty amount must not exceed 4 per cent of the item's value.
| |