Customs Duty

Customs Duty is a tax levied by the Central Government on goods imported into, and certain goods exported from, India, under the Customs Act, 1962 and the Customs Tariff Act, 1975. Unlike Central Excise Duty, VAT, Service Tax and CST, Customs Duty was NOT subsumed under GST — it continues to be levied separately.

However, an imported good is typically also charged IGST (in addition to Basic Customs Duty) at the point of import, treating the import as a form of inter-state supply into India — so an importer generally pays both Basic Customs Duty and IGST on the same imported goods, with the IGST portion being available as Input Tax Credit to a registered importer, just like any other IGST paid on an inter-state supply.

Purposes of Customs Duty:

• Revenue for the government. …