Customs duty rejig to encourage local manufacturing

The government overhauled the customs duty structure on Monday to encourage local manufacturing and slow down imports as a way of steering the economy out of recession.

The duty rejig also entails a new levy—an agriculture infrastructure development cess ranging from 1.5% to 100%. However, the final price will remain unchanged as the basic customs duty will be lowered to accommodate the new tax. Since proceeds from all kinds of cess do not go into the pool of taxes shared with states, the Centre has full access to it.