New Delhi: On a proposal of the commerce ministry, the Narendra Modi-led government is reportedly recommending to restrict purchase of liquor at duty-free shops to one bottle, as part of steps to reduce import of non-essential goods. Moreover, the ministry has also recommended that purchase of cigarette cartons at duty-free shops should be prohibited. Also Read - Union Budget 2020: More Than 300 Items Likely to See Customs Duty Hike
A duty-free shop is where an inbound international passenger can generally purchase goods worth about Rs 50,000 without paying any import duty. At present, inbound international passengers are permitted to purchase two litres of alcohol and a carton of cigarette from these shops. There are countries that allow only one litre of liquor to international passengers and the same practice can be adopted in India. Also Read - Union Budget 2020: Higher Duty on Import of Fruit and Vegetable Pulps, Concentrates, Says CII
Notably, these recommendations were part of proposals for the upcoming Budget 2020, which would be presented by Finance Minister Nirmala Sitharaman on February 1. Also Read - Ahead of Union Budget 2020, PM Modi Meets Top Economists, Discusses Steps to Revive Economy
Earlier, the commerce ministry in its budget recommendations had proposed rationalisation of basic customs on over 300 items across sectors including furniture, chemicals, rubber, coated paper and paper boards.
On footwear and related products, the ministry had suggested increase in duty to 35 per cent from the current 25 per cent while for new pneumatic tyres of rubber, it had proposed to hike customs duty to 40 per cent from the current 10-15 per cent.
The ministry has proposed to increase import duty on wooden furniture to 30 per cent from the current 20 per cent. For coated paper, paper boards and hand made papers, it has suggested doubling the duty to 20 per cent.
The Ministry has asked for the removal of import duty on waste paper and wood pulp, which is currently at 10 per cent and 5 per cent, respectively. The paper industry has expressed concerns about cheap imports and a surge in inbound shipments.
Government officials and FM Sitharaman held series of pre-Budget consultations with leaders of various industries and other stakeholder groups to curb the ongoing economic slowdown. Speaking to a leading daily, an official had asserted that the Finance Ministry is taking number of suggestions and is also mulling to reward the middle class by cutting down their tax burden.
(With agency inputs)