How to Calculate Custom Duty

8/4/2019 How to Calculate Custom Duty

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Type of indirect tax levied on goods imported into India aswell as on goods exported from India.

The Central Board of Excise & Customs (CBEC) is the apexbody for matters pertaining to customs.

Central Board of Excise and Customs (CBEC) is a part ofthe Department of Revenue under the Ministry of Finance,Government of India.

Custom duties are levied on the goods and at the rates

specified in the schedules to the Custom Tariff Act, 1975.Indian Custom duty is a major source of India's revenue.


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Following types of Indian custom duties arelevied :

1-Basic custom duty A) Ad Valorem

B) Specific rate of duty 2-Countervailing Duty(Additional Duty of

Customs )

3-Special Additional duty of customs (Special cvd

or SAD)

4-Anti-Dumping duty

5-Export duty-


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Basic custom duty- Basic custom duty islevied on all goods imported into India as

prescribed in First Schedule of customs Tariffact 1975. This Schedule is amended fromtime to time

There are two types of Basic customduties which can be applied.


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A) Ad Valorem

Ad valorem duties are based on value and

expressed as a percentage of the AssembleValue (Assessable Value = Cost + Insurance+ Freight + 1% landing charges). Majority ofIndian Custom Tariff rates are on ad valorem

basis.


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B) Specific rate of duty

Specific rate of duty is based on unit in termsof weight, number etc. In Indian CustomsTariff the specific duty is applicable onalmond based on its weight (per kg).
http://www.articletrader.com/finance/taxes/indian-customs-duty-import-duty-in-india-custom-tariff-rate.htmlhttp://www.articletrader.com/finance/taxes/indian-customs-duty-import-duty-in-india-custom-tariff-rate.html


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Countervailing Duty(Additional Duty ofCustoms ) - This duty is levied on the total

cost of imported goods at the rate Equal toexcise duty on like goods when manufacturedin india.


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Special additional duty of Customs are leviedfor counter balancing domestic taxeslike sales tax, value added tax, local tax orany other charges for the time being levied

on a like article on its sale, purchase ortransportation in India.

There is no education cess applicable on theSpecial CVD. Vat/sales tax can get refund ofSpecial CVD.


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When the goods are exported by a country toanother country at a price lower than itsnormal value, this is called dumping.

This is an unfair trade practice which canhave a distortive effect on international trade.

Thus, the purpose of anti dumping duty is torectify the trade distortive effect of dumpingand re-establish fair trade.

The use of anti dumping measure as an

instrument of fair competition is permitted bythe WTO. It provides relief to the domesticindustry against the injury caused bydumping.


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Export duty is levied when goods areexported from a country. In India

There are very few articles like Iron ore (20%),Raw fur lamb skin(10%), Ferrous waste andscrap(15%), Cycle saddle leathers(15%) aresubject to export duty.

Any other articles declared by Govt. fromtime to time


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Cost+Insurance+Freight+1%Landing charges ofimported goods


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Duty % Amount ValueA Assessable Value Rs 10,000B Basic Custom Duty 10% 1, 000C Sub-Total for calculating CVD (A+B) 11,000D CVD C x excise duty rate 8% 880E Education cess of excise 2% of D 17.60F SAH Education cess of excise 1% of D 8.80G Sub-total for edu cess on customsB+D+E+F 19,06.40H Edu Cess of Customs 2% of G 38.13I SAH Education Cess of Customs 1% of G 19.06J Sub-total for Spl CVD C+D+E+F+H+I 11,963.59K Special CVD u/s 3(5) 4% of J 478.54L Total Duty 2,442.13


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Please Check thehttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htm

to know the exact rate of custom duty as perHS CODE of your product.
http://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htmhttp://www.cbec.gov.in/customs/cst-2k11-12/cst1112-idx.htm


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How to Calculate Custom Duty

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