The 4% confusion – Additional duty – computation
EVERY action of the government has its cascading effects right across the country. While reducing the peak rate of customs duty from 15 to 12.5%, the benevolent Finance Minister imposed a 4% special duty, in effect increasing the duty by 1.5%. Had he simply increased the duty by 1.5%, there would have been no problem, but this special duty has caused quite a confusion. The million dollar question is whether education cess component is to be taken into consideration while computing this very special duty. It appears that consignments are piling up without clearance for want of a clarification. Since we carried an analysis of the issue, in our special column, we have been getting frantic messages on the method of calculation. In view of the confusion the author has revised the article and discussed both the options. Please see the revised article in our Special column. Ultimately it is the government which should clarify the position and the importers will be grateful if the Board comes out with a clarification at the earliest.