Highlights of Budget 2017 : Custom Laws (Part 1) by Saurabh Chhabra

General Changes in Custom Duty Rates :

• Basic Customs Duty (BCD) on Liquefied Natural Gas has been reduced from 5% to 2.5%
• BCD on Medium Quality Terephthalic Acid (MTA) & Qualified Terephthalic Acid (QTA) reduced from 7.5% to 5%
• BCD on Nickel has been exempted from the earlier level of 2.5%
• BCD on Vegetable tanning extracts, namely, Wattle extract and My robalan fruit extract reduced from 7.5% to 2.5%
• BCD & CVD on all items of machinery for fuel cell based power generating systems to be set up in country reduced to 5% & 6% respectively
• BCD on Items of machinery for balance of systems operating on biogas/ bio-methane/ by-product hydrogen, subject to conditions reduced to 5%
• CVD on Items of machinery for balance of systems operating on biogas / bio-methane/ by-product hydrogen, subject to conditions reduced to 6%
• BCD on Parts for use in the mfr. of LED lights or fixtures, including LED lamps, subject to actual user condition fixed at 5%
• CVD on Parts for use in the mfr. of LED lights or fixtures, including LED lamps, subject to actual user condition fixed at 6%.
• BCD on Inputs for use in the mfr of LED Driver & MCPCB for LED lights/fixtures, including LED lamps, subject to conditions fixed at 5%.
• BCD on o-Xylene fully exempted from the earlier level of 2.5%.
• BCD on 2-Ethyl Anthraquinone [2914 69 90] for use in manufacture of hydrogen peroxide, subject to actual user condition reduced to 2.5%.
• BCD on Vinyl Polyethylene Glycol (VPEG) for use in manufacture of Poly Carboxylate Ether, subject to actual user condition reduced to 7.5%
• BCD on Nylon mono filament yarn for use in monofilament long line system for Tuna fishing, subject to conditions reduced to 5%.
• BCD on Copolymer coated MS tapes/stainless steel tapes for mfr. of certain telecommunication grade optical fibres with conditions to be 10%.
• BCD on MgO coated cold rolled steel coils [7225 19 90] for use in the mfr. of CRGO steel, subject to actual user condition reduced to 5%.
• BCD on Hot Rolled Coils for use in the mfr of welded tubes and pipes falling under heading 7305 /7306, subject to conditions reduced to 10%.
• BCD on Clay 2 Powder (Alumax) for use in ceramic substrate for catalytic convertors, subject to actual user condition reduced to 5%
• BCD on Solar tempered glass for use in the manufacture of solar cells/panels/modules exempted from earlier level of 5%.
• CVD & SAD on Resin and catalyst for use in the manufacture of cast components for Wind Operated Energy Generators with conditions exempted.
• CVD on Membrane Sheet & Tricot/ Spacer for use in mfr. of RO membrane element for household type filters with conditions reduced to 6%.
• BCD on Resin and catalyst for use in the manufacture of cast components for Wind Operated Energy Generators with condition reduced to 5%.

Changes have also been made in Customs Duty structure for protection to domestic industry. These are:-

• BCD on Cashew nut, roasted, salted or roasted and salted increased to 45%
• SAD on Populated Printed Circuit Boards (PCBs) for use in the manufacture of mobile phones, subject to actual user condition increased to 2%
• BCD on RO membrane element for household type filters increased to 10%

For promoting cashless transactions & promoting domestic manufacturing, following Customs Duty changes made:-

• BCD, CVD & SAD on Miniaturized POS card reader for m-POS (not including mobile phones or tablet computer exempted.
• BCD, CVD & SAD on Micro ATM as per standards version 1.5.1, exempted.
• BCD, CVD & SAD on Finger Print Reader / Scanner, and Iris Scanner exempted.

©Saurabh Chhabra – Tax Editor at LexisNexis