Budget 2026: India Inc seeks GST-style simplification in customs duty structure
Key demands include rationalizing customs duty rates, reducing the current eight-slab structure to five or six, and introducing a single-window customs clearance mechanism for imports and exports. The industry also wants a firm timeline for Authorized Economic Operator (AEO) certification and a formal contract for the Directorate of Revenue Intelligence (DRI) to conduct investigations.
Also Read: Budget 2026: India’s shift in power depends on fixing a crisis that millions have complained about
On dispute resolution, businesses are pushing for a plan to digitize the entire litigation process and remove the Rs 1.52 lakh crore customs duty logjam currently linked to legal disputes.
Gulzar Didwania, Partner, Deloitte India, highlighted the operational hurdles faced by merchants. “Currently, an importer or exporter has to apply to various government departments and ministries to get customs clearance of their shipments. This becomes a major obstacle to doing business. While I am ready to comply with all these, I should at least know that this is the department I should go to,” he said.
He added: “There is already a provision under the Customs Act that empowers customs to act as a single window for all import-export related licensing requirements. We want this facility to be operational as soon as possible so that it truly achieves the true spirit of single window.”
Industry sources also want the AEO plan to include strict timelines for certification; because such recognition increases global trade efficiency by allowing importers, exporters and customs brokers to receive trade facilitation support from foreign customs authorities.Also Read: Budget 2026: Phone machines likely to get rid of task friction“Just as the government has issued guidelines for the functioning of DGGI under the GST law, the industry is also waiting for similar guidelines or regulation for the Directorate of Revenue Intelligence (DRI),” Didwania added.
For India to achieve the $5 trillion economy target, fiscal policy must provide tax certainty and support competitiveness in manufacturing, said Saurabh Agarwal, Tax Partner, EY India. He noted that although ‘Sabka Vishwas’ and ‘Vivad se Vishwas’ have successfully resolved central excise, service tax and income tax disputes, a parallel framework for customs does not exist.
“To effectively arrest pending cases, it is imperative to introduce a Customs Dispute Resolution Scheme covering pending cases up to the Court level. Most importantly, the architecture of this scheme must change from a ‘complete resolution of a pending case’ approach to adopting an ‘issue-wise’ or ‘year-wise’ resolution mechanism. Such a pragmatic move will not only unlock fixed revenue but also a predictable tax, which is vital for global investors,” Agarwal said. “It will also encourage the environment,” he said.
As of March 2024, 38,014 cases involving Rs 1.52 lakh crore in customs duty are locked in litigation.
Abhishek Jain, Partner and National Head, Indirect Tax, KPMG India, said that amid global uncertainty and ongoing tariff wars, the industry is looking forward to Budget 2026 for stronger support for Made in India. Expectations include rationalization of customs duties on essential raw materials, simplification of tax brackets to reduce compliance disputes, and a one-time window to resolve old disputes and cases.
“Shorter closing of related party valuation approvals for importers through post-clearance risk-based inspections instead of the current tedious process is seen as a practical step towards improving ease of doing business and supply chain efficiency,” Jain added.With inputs from PTI
