Ehsan Amiri

Additional duties of customs, commonly referred to as the Countervailing Duty (CVD) and Special Additional Duty of Customs (SAD), has been be replaced by the levy of the Integrated Goods and Services Tax (IGST), barring a few exceptions, such as pan masala and certain petroleum products. The IGST replaces the previous system of federal and state categories of indirect taxation.

A Customs Duty calculator is made available on the online portal of excise and customs, the ICEGATE website. There are seven rates prescribed for IGST– Nil, 0.25 percent, 3 percent 5 percent, 12 percent, 18 percent, and 28 percent. The actual rate applicable to an item will depend on its classification and will be specified in Schedules notified under Section 5 of the IGST Act, 2017.

Further, a few items such as aerated water products, tobacco products, and motor vehicles, among others, will attract an additional levy of the GST Compensation Cess, over and above IGST. The Cess is calculated on the transaction value or the price at which the goods are sold.

The Goods and Services Tax (Compensation to States) Act, 2017 was enacted to levy Compensation Cess for providing compensation to Indian states for the loss of revenue arising on account of implementation of the Goods and Services Tax from July 1, 2017.

The Compensation Cess on goods imported into India shall be levied and collected in accordance with the provisions of Section 3 of the Customs Tariff Act, 1975, at the point when duties of customs are levied on the said goods under Section 12 of the Customs Act, 1962, on a value determined under the Customs Tariff Act, 1975.

Basic duty is the typical tax rate that is applied to goods. The rates of custom duties are specified in the First and Second Schedules of the Customs Tariff Act of 1975. The First Schedule contains rates of import duty, and the second schedule contains rates of export duties. Most of the items in India are exempt from custom duty, which is generally levied on imports.

The first schedule contains two rates: Standard rate and preferential rate. The preferential rate is lower than the standard rate. When goods are imported from a place specified by the central government (CG) for lower rates, the preferential rate is applicable. In any other case, the standard rate will be applicable. If the CG has signed a trade agreement with the country of origin, then the CG may opt to charge a lower basic duty than indicated in the first schedule.

Yes, if the consignee does not wish to act as the EoR / IoR. Often the consignee may not want to get involved in the import or export of their goods because they don't have the experience and knowledge of the international shipping requirements, or the export / import process, or they simply do not have a legal entity to import/export against. Therefore, to ensure they meet Customs Compliance, the need for a Trade Compliance Solution with IoR or EoR will still exist.

International Trade Compliance (ITC) describes how goods enter (or leave) a country, conforming to all local import requirements, laws and regulations including import licenses, restrictions and payment of taxes and duties. This includes the requirement for an Exporter and Importer of Record to be listed on all shipments.

Supplies of goods sent to the Channel Islands are regarded as exports for VAT purposes and may be zero-rated if the following conditions of proof of export are met:

• The goods are exported from the EU within the specified time limits

• The exporter has official or commercial evidence of export

• Comply with Customs Notice