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Concessional Tariffs, 20% Value Addition Rule & 30% DTA Cap to Balance Exports and Domestic Market
Anytime News Network
In a significant move to cushion the impact of global trade disruptions, the Central Board of Indirect Taxes and Customs (CBIC) has rolled out a one-time relief measure for Special Economic Zone (SEZ) units. The scheme allows eligible units to sell manufactured goods in the Domestic Tariff Area (DTA) at concessional customs duty rates.
The relief, announced in the Union Budget 2026-27, has been implemented through a customs exemption notification under Section 25 of the Customs Act, 1962. It will remain in force from April 1, 2026, to March 31, 2027. Eligibility is restricted to SEZ units that commenced production on or before March 31, 2025.
To ensure fair competition with domestic manufacturers, the government has introduced key safeguards. Beneficiary units must maintain a minimum value addition of 20% in their products. Additionally, DTA sales under concessional rates are capped at 30% of the highest annual export performance (FOB value) recorded in any of the last three financial years.
The scheme offers notable duty reductions—for instance, 10% duty lowered to 9%, 20% to 12.5%, and duties ranging between 30–40% reduced to 20%. This is expected to enhance competitiveness and ease supply chain pressures caused by global uncertainties.
However, certain sensitive sectors have been excluded to protect domestic industries. The implementation will be carried out through an automated system with faceless assessment, ensuring efficiency and transparency.
Experts believe this calibrated relief strikes a balance between supporting export-driven SEZ units and safeguarding domestic market interests, making it a timely intervention in a volatile global trade environment.
