Budget 2026: In focus GST style reform of customs and amnesty schemes
The GST rejig in September 2025 appears to have become a template for pushing for reforms in taxes and duties. With the Budget 2026 only a few days away, many investors and analysts are now urging for GST-style transformation of the complex domain of customs.
Kolkata: Keep it simple GST style -- this is what India Inc and man experts are urging finance minister Nirmala Sitharaman to do with the complex web of customs duties to boost trade and accelerate resolution of disputes. Ahead of the budget the reforms that industry wants to see in the field of customs a slew of reforms involving rationalisation of customs duty rates and cutting down the existing eight-slab structure to five or six at the most. The investors also the government to introduce a single-window clearance mechanism for imports and exports.
Apart from the overhaul of customs duty structure, industry also wants quick action on amnesty schemes to unlock Rs 1.53 lakh crore which is mired in disputes. In short, the ease of doing business in the domain of customs has to go up.
Single window can cut down on bureaucracy
Gulzar Didwania, partner of Deloitte India has eloquently described what ails the customs sector. "Currently, an importer or an exporter has to approach various government departments and ministries to get clearance for their shipments. That is becoming a big hindrance in doing trade. While I am ready to comply with all these things, at least I should know that this is the department where I should go... Customs already has a provision under the Customs Act, which empowers them to act as a single window for all these import export related licensing requirements. We want this facility to be launched as soon as possible, so that it actually achieves the real, true spirit of single window clearance," Didwania was quoted in the media as saying.
Digitisation of litigation
India Inc also wants to bring the fruits of digitisation to the world of customs. It is also urging the government to announce a system which will end the quagmire in which nothing less than Rs 1.52 lakh crore is stuck in legal disputes. Also on the wishlist is an AEO (authorised economic operator) scheme which can usher in timelines for certification. They point out that such a practice will help importers, exporters, and customs brokers to get trade facilitation from foreign customs administrations.
Parallels of "Sabka Vishwas" and "Vivad se Vishwas"
If "Sabka Vishwas" and "Vivad se Vishwas" can address prickly issues in central excise, service tax, and income tax disputes, why not introduce similar schemes in customs, ask experts. EY India Tax Partner Saurabh Agarwal was quoted in the media as saying, "To effectively arrest spiralling litigation, it is imperative to introduce a Customs Dispute Resolution Scheme coverin cases pending up to the Tribunal level. Crucially, the architecture of this scheme must shift away from the 'complete settlement of a pending litigation' approach to adopting an 'issue wise' or 'year-wise' settlement mechanism. Such a pragmatic move would not only unlock stuck revenue but also foster a predictable tax environment essential for global Invertors."
"Sabka Vishwas" was targeted at indirect taxes such as service tax/excise, while "Vivad se Vishwas" pertained to income tax disputes pending in tribunals or courts.