Government of India imposes custom duty on imports

Indian custom duty is a form of indirect tax that is levied on imports in India from anywhere across the world. It is levied on all kind of goods and products that are imported in India with an exception of goods like lifesaving drugs and equipment, fertilizers, food grains etc. custom duty is defined under the customs act 1962 and empowers the government to levy taxes on imports and exports, prohibit export and import of certain goods and devise procedure for import and export. Custom duty is levied as per the quantity of goods or on ad valorem basis that is value, dimensions, weight or any other criteria for the goods in question.

Government of India imposes custom duty on imports and exports for a number of purposes, the primary purpose of which is to raise the state revenue and also to safeguard the domestic industries from predatory foreign competition and saving the domestic market from getting flooded with foreign goods, Indian custom duty is of mainly five types which are basic custom duty, additional or countervailing duty, protective duty, anti-dumping duty and safeguard duty. Protective duty is imposed to protect the domestic industries from international competition.Anti-dumping duties are imposed on the goods which are being imported below fair market price and safeguard duty is imposed if the government is satisfied that the sudden increase in exports can potentially damage the domestic industry.

The rate of custom duty can be specific that is on per unit basis or on ad valorem basis that is on the value of the goods and generally ranges from 1% to 150% depending on the goods and is levied and collected by the custom department of ministry of finance. Importers should have the knowledge of the Indian custom duty as it is a cost incidental to their imports and has to be borne by them and they can find the rates of custom for different goods online on various websites providing export import data.