Sunday, October 5, 2008

different types of duties levied and collected on imported goods

Main types of custom duties

  1. Basic custom duty:-
    Basic custom duty is the main type of custom duty. It is payable u/s 2 of custom tariff act 1975.It has three sub parts
    i) Standard rate
    ii) Effective rate
    iii) Preferential Rate

    Govt. of India can declare its rates and goods on which it levied u/s 4 of C.T.A. Govt. fixed the preferential area for following countries for applying preferential rate
    i) China
    ii) Pakistan
    iii) Bangladesh
    iv) Butan
    v) Nepal
    vi) Shri lanka
    vii) Mauritius
    viii) Seychelles
    ix) Tonga
    x) U.A.E.

  2. Auxiliary custom duty:-

    This is also part and type of custom duty .Basically this is 10% surcharge on all goods except following goods
    i) crude oil and petroleum
    ii) Gold and silver
    iii) Certain GATT ( bound items)

    This is started under the finance act , 1999 it is upto 31st march 2000.

  3. Additional duty of custom or countervailing duty:-

    This is the main type of custom duty. If any manufacturer imports goods he will responsible for paying additional duty of custom equal to excise duty as same as he manufactured in India.This duty safeguards the interest of Indian manufacturer who purchased raw material from India.
    Example:- Now since finance bill 2006 , CVD of 4% on all imports

  4. Special additional duty of customs :-
    Value of SAD= rate of SAD x ( Assessable value + basic duty + surcharge +CVD)
    SAD first was abolished w.e.f. 9-1-2004
    Now it starts again from 1-3-2006

  5. Protective duties:-
    Protective duties are duties which safeguarding domestic industries. If central govt. thinks that if a manufacturer imports indigenous goods .It will harmful for following reason
    i) it may cheaper
    ii) it may attract Indian people

    So govt. can imposed protective duty for safeguarding domestic industry .

  6. Countervailing duty on subsidized articles u/s 9
    CVD on subsidized articles with following conditions
    i) Govt. gives subsidy for production
    ii) Govt gives subsidy for export
    CVD must not more than subsidy.

  7. Anti dumping duty:-
    If any country export to India less than normal price and India people imports this goods then central govt. can impose anti dumping duty.
    Value of anti dumping duty= margin of dumping
    Margin of dumping = normal price – export price

  8. Safeguarding duty section 8b
    If any body want to injury to domestic industry .For this he imported goods with high quantity . The govt . can imposed safeguard duty on such goods
    I) imports from developing country must exceed 3% share of total production

  9. Export duty :-

    At present
    i) 15% export duty is levied on hides , skins and leather .
    ii) 10% on snake skin , hides , skin and leather
    iii) No duty on any other export of product


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