Custom Duty in India and Importance in Import Export Business

Custom duty India is a tax imposed on the import and export of commodities. The purpose of Indian Custom duty is to protect the country’s economy, environment, residents, etc by regulating the movement of good especially banned and protected goods, in and out of any country. Custom duty India is also an important source of revenue for the country. Indian

Custom Duty India falls under the Central Board of Excise and Custom (CBEC) which runs under the Revenue department. CBEC prepares policies for collecting custom duty, evasion, prevent smuggling and administrative decision.

Indian Custom Duty is charged on roughly all goods imported into the country. These are divided into

Basic Customs Duty (BCD)
Countervailing Duty (CVD)
Additional Custom Duty or Special CVD
Protective Duty
Anti-Dumping Duty
Educational Cess on custom duty

Calculation of Custom Duty

Indian custom duty is calculated on the specific or valuation of the product. The value of the good is determined by Rule 3 of Customs Valuation Rule 2007. According to this rule, the value of the imported product is determined from the transaction value which is then adjusted under Rule10.

If there are no valuation factors available Custom Duty India has the following hierarchy -

Comparative Value Method compares transaction values of items similar in nature (Rule 4)
Comparative Value Method compares the transaction value of similar items (Rule 5)
Deductive Value Method uses the sale price of items in the importing country (Rule 7)
Comparative Value Method uses costs related the fabrication, materials as well as profit in the production country (Rule 8)
Fallback Method is based on the earlier methods that offer higher flexibility (Rule 9)

Import Custom Duty in India is calculated on various factors such as the place of acquisition of the product, where the product is made, the material of the product, weight, and dimension of the product. When an importer brings a product for the first time it must be declared according to custom rules.

Indian Custom Duty can be paid online by

Log-in to ICEGATE portal using credentials
Click e-payment
All the unpaid challans can be viewed
Users can select the challan they wish to pay
Importers can make payment for challan online
Users will be redirected ICEGATE portal where they save or take a print out of the payment receipt.

Formalities for import-export changed after GST was introduced in 2017. On SEAIR portal you can get Import Custom Duty in India for any product along with HS Code.

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