Union Budget 2025-26 may introduce amnesty scheme for customs duty
What's the story
The upcoming Union Budget for the fiscal year 2025-26, may include an amnesty scheme for customs.
Industry experts expect this move as a strategic measure to reduce litigation and promote ease of doing business.
The introduction of such a scheme has been a long-standing demand of the industry, to address unresolved legal issues pertaining to customs duties.
Expert opinion
Industry experts support amnesty scheme for customs
Anurag Sehgal, Managing Director of Price Waterhouse & Co LLP, has thrown his weight behind the proposed amnesty scheme. He thinks this move is in line with the government's goal of reducing litigation.
Sehgal said, "Having an amnesty scheme for customs especially covering pre-GST legacy taxes like additional duty, special additional duty has been one of the asks of the industry."
Legal backlog
Over 40,000 customs duty cases pending in courts
Currently, more than 40,000 customs duty-related cases are pending in different courts and tribunals.
The backlog has led consultancy firm EY India to recommend a one-time dispute/litigation resolution/settlement scheme under the Customs Law.
Such a scheme would expedite the resolution of these long-standing disputes, saving both time and resources for taxpayers as well as the government.
Business impact
Amnesty scheme could benefit small businesses
Mahesh Jaising, Partner at Deloitte India, has also expressed his support for the proposed amnesty scheme.
He thinks that such a move would "end long-drawn litigation to resolve long-standing disputes, alleviate the burdened judicial pipeline and upgrade the law."
Jaising added that this initiative would especially benefit small businesses by enabling them to "avoid past disputes and move ahead with a clean slate."
Wishlist
Industry calls for rate rationalization, review of exemptions
Another major demand from the industry is rate rationalization to boost the Make in India push.
Sehgal stressed that "rate rationalization would help promote investment in India."
The industry is also demanding a review of exemptions, especially those with sunset dates, which are important for sectors such as sustainability, green tech, MSMEs and healthcare.