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Customs duty is a tax which the State collects on
goods imported
into or exported out of the boundaries of a country.
Customs duties
now form a significant source of revenue for all
countries, more
so in the case of developing countries like India.
The levy
In India, customs duties are levied on the goods and
at the
rates specified in the Schedules to the Customs Tariff
Act, 1975.
The taxable event is import into export from India. Export
duties
are practically non-existent at present. They are levied
occasionally
to mop up excess profitability in international price of
goods in
respect of which domestic prices may be low at given time.
But sweep
of import duties is very wide, almost universal, barring a
few goods
like food grains, fertilizer, life saving drugs and
equipments etc.
Import duties generally consist of the following:
- Basic duty. It may be at the standard rate
or,
in the
case of import from some countries, at the preferential
rate.
- Additional customs duty equal to central excise
duty leviable
on like goods produced or manufactured in India. It is
commonly
referred to as countervailing duty or C.V.D.
- Special additional duty of Customs at the rate
of 4% 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
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- Additional duty of Customs at the rate of
Re. 1/- per
liter
on imported motor spirit (petrol) and high speed diesel
oil.
- Anti-dumping duty/Safeguard duty for import to
specified goods
with a view to protecting domestic industry from unfair
injury.
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