The import of 4G equipment by Indian telecom firms won't be exempt from customs duty with the government taking the view that it doesn't fall within the purview of the global Information Technology Agreement (ITA), under which the country is bound to allow dutyfree imports of telecom and IT products. The Central Board of Excise and Customs (CBEC) has clarified that the equipment wasn't covered under the agreement signed in 1996. This follows a reference from the field regarding imports by Reliance Jio Infocomm including Base Transceiver Station and Base Station Controller equipment needed for its 4G cellular architecture.
ET had first reported on the issue on May 31. At the time, an official had said that the duty implication could be as much as Rs. 1,000 crore.
“This is an industry-wide issue regarding applicability of custom duties on import of certain equipment and we await clarification from authorities.Reliance Jio is committed to 100% compliance of applicable regulations and will fully abide by the final decision taken by the government in the matter, within the overall rights and responsibilities of the assessee provided under law,“ said a spokesperson for Re liance Jio Infocomm in response to ET's queries on the matter.
“These would fall in the residual entry,“ said a government official aware of the communication, referring to the 4G equipment. Telecom and IT equipment imports falling in the residual category are not covered by the ITA, the official said, and will face 10% customs duty.
A host of IT and telecom products are exempted from basic customs duty in line with India's commitment at the World Trade Organization under the ITA. However, technology has changed rapidly and products have undergone complete transformation in the past two decades. A number of importing countries such as India have begun questioning the continuance of the zero-duty regime for newer telecom and IT products that did not exist when the agreement was signed. Equipment import for 4G falls in this category.
Items covered by the ITA represent 97% of the world trade in IT products. Signatories to the agreement have committed to completely eliminating tariffs on IT products covered by the agreement.
The ITA covers a large number of technology products, including computers, telecommunication equipment, semiconductors, semiconductor manufacturing and testing equipment, software, scientific instruments, as well as most of the parts and accessories of these products.
ET had first reported on the issue on May 31. At the time, an official had said that the duty implication could be as much as Rs. 1,000 crore.
“This is an industry-wide issue regarding applicability of custom duties on import of certain equipment and we await clarification from authorities.Reliance Jio is committed to 100% compliance of applicable regulations and will fully abide by the final decision taken by the government in the matter, within the overall rights and responsibilities of the assessee provided under law,“ said a spokesperson for Re liance Jio Infocomm in response to ET's queries on the matter.
“These would fall in the residual entry,“ said a government official aware of the communication, referring to the 4G equipment. Telecom and IT equipment imports falling in the residual category are not covered by the ITA, the official said, and will face 10% customs duty.
A host of IT and telecom products are exempted from basic customs duty in line with India's commitment at the World Trade Organization under the ITA. However, technology has changed rapidly and products have undergone complete transformation in the past two decades. A number of importing countries such as India have begun questioning the continuance of the zero-duty regime for newer telecom and IT products that did not exist when the agreement was signed. Equipment import for 4G falls in this category.
Items covered by the ITA represent 97% of the world trade in IT products. Signatories to the agreement have committed to completely eliminating tariffs on IT products covered by the agreement.
The ITA covers a large number of technology products, including computers, telecommunication equipment, semiconductors, semiconductor manufacturing and testing equipment, software, scientific instruments, as well as most of the parts and accessories of these products.
2 comments:
Very nice info
Thanks
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