Import Duty Explained
Import duty is a tax on goods from foreign countries. It's determined by factors like the goods' value, origin, and type. This tax benefits the government and safeguards domestic industries.
Custom duty in India is defined by the Customs Act 1962, managed by the Central Board of Excise & Customs.
Import Duty in India
India's tax system has recently been reformed with the GST (Goods and Services Tax) introduction. This new tax is paid by consumers when they use goods and services.
Previously, goods and services faced multiple taxes. With GST, there's just one tax. GST is made up of CGST, SGST, and IGST, depending on whether transactions are within or between states.
Import and export duties are now included in the IGST, simplifying taxation.
Import Duty Determining Factors
- Goods' market value
- Free trade agreements that might lower duties
- The goods' description for classification and duty rate calculation
- Country of origin
- Country-specific regulations
- Whether the goods are for personal or commercial use