Mohit (CA) (755 Points)
15 April 2012
CA. Abhishek K. Pandey
(Manager (Advance))
(901 Points)
Replied 15 April 2012
SAD is the duty which is leviable on the imports in addition to yhe regular duty. There are various types of SAD, like equivalent to excise, vat duty or CVD etc.
Please mention the type of SAD which you have saw, so that, that can be clarified.
Mohit
(CA)
(755 Points)
Replied 15 April 2012
Thanks Abhishek... But still I am not clear with the concept... If you could give me some simple example wrt this.
piyush.a.k
(-)
(252 Points)
Replied 15 April 2012
when you buy any goods in india from indian manufacturer than a tax is levied in name of VAT or sales tax. but when you import the same than such duties are not levied in vat or sales tax. To over come this and to levy a tax on such import a duty in name of Special Additional Duty (SAD) is charged which is equivalent to our local taxes like vat or sales tax.
piyush.a.k
(-)
(252 Points)
Replied 15 April 2012
it is to a maximum of 4 %. Hope you understand the concept behind the same. At the time of export a SAD refund can be claimed by the importer.
GOPAL AGGARWAL
(DOING NOTHING)
(1339 Points)
Replied 15 April 2012
MOHIT PLEASE GO THROUGH THE LINK GIVEN BELOW
WHICH WILL DEFINITELY HELP YOU TO UNDERSTAND THE 'SAD'
OR
Type of Customs Duties
Basic customs duty |
Basic customs duty levied u/s 12 of Customs Act is generally 10% of non-agricultural goods, w.e.f. 1-3-2007. |
||||||||||||||||||
Countervailing Duty (CVD) |
· CVD equal to excise duty is payable on imported goods u/s 3(1) of Customs Tariff Act to counterbalance impact of excise duty on indigenous manufactures, to ensure level paying field. · CVD is payable equal to excise duty payable on like articles if produced in India. It is payable at effective rate of excise duty. · General excise duty rate is 10.30% w.e.f. 27-2-2010 (10% basic plus 2% education cess and SAH Education cess of 1%). · CVD is payable on assessable value plus basic customs duty. In case of products covered under MRP provisions, CV duty is payable on MRP basis as per section 4A of Central Excise. · CVD can be levied only if there is ‘manufacture’. · CVD is neither excise duty nor basic customs duty. However, all provisions of Customs Act apply to CVD.
|
||||||||||||||||||
Special CVD |
Special CVD is payable @ 4% on imported goods u/s 3(5) of Customs Tariff Act. This is in lieu of Vat/sales tax to provide level playing field to Indian goods. Traders importing goods can get refund. CVD is not payable if goods are covered under MRP valuation provisions/ |
||||||||||||||||||
Education Cess |
Education cess of customs @ 2% and SAH Education cess of 1% is payable. |
||||||||||||||||||
Total duty |
Total import duty considering all duties plus education cess on non-agricultural goods is generally 26.85% |
||||||||||||||||||
Other duties |
NCCD has been imposed on a few articles. In addition, on certain goods, anti-dumping duty, safeguard duty, protective duty etc. can be imposed. Cess is payable on some goods imported/exported. |
||||||||||||||||||
Safeguard duty |
Safeguard duty can be imposed if large imports are causing serious injury to domestic industry. In addition, product specific safeguard duty on imports from China can be imposed. |
||||||||||||||||||
Anti dumping duty |
|
Calculations of customs duty
General customs duty rate for non-agricultural goods s 10%. Total customs duty payable w.e.f. 27-2-2010 is 26.85% as excise duty rate is generally 10%
Assessable value = CIF Value of imported goods converted into Rupees at exchange rate specified in notification issued by CBE&C plus landing charges 1% (plus some additions often arbitrarily and whimsically made by customs).
Calculation of customs duty payable is as follows - |
|
|
|
|
|
|
Duty % |
Amount |
Total Duty |
(A) |
Assessable Value Rs |
|
10,000 |
|
(B) |
Basic Customs Duty |
10 |
1,000.00 |
1,000.00 |
(C) |
Sub-Total for calculating CVD '(A+B)' |
|
11,000.00 |
|
(D) |
CVD 'C' x excise duty rate |
10 |
1,100.00 |
1,100.00 |
(E) |
Education cess of excise - 2% of 'D' |
2 |
22.00 |
22.00 |
(F) |
SAH Education cess of excise - 1% of 'D' |
1 |
11.00 |
11.00 |
(G) |
Sub-total for edu cess on customs 'B+D+E+F' |
|
2,133.00 |
|
(H) |
Edu Cess of Customs – 2% of 'G' |
2 |
42.66 |
42.66 |
(I) |
SAH Education Cess of Customs - 1% of 'G' |
1 |
21.33 |
21.33 |
(J) |
Sub-total for Spl CVD 'C+D+E+F+H+I' |
|
12,196.99 |
|
(K) |
Special CVD u/s 3(5) – 4% of 'J' |
4 |
487.88 |
487.88 |
(L) |
Total Duty |
|
|
2,684.87 |
(M) |
Total duty rounded to |
Rs |
|
2,685 |
|
|
|
|
|
|
Notes – Buyer who is manufacturer, is eligible to avail Cenvat Credit of D, E, F and K above. |
|||
|
A buyer, who is service provider, is eligible to avail Cenvat Credit of D, E and F above. . |
|||
|
A trader who sells imported goods in India after charging |
|
||
|
Vat/sales tax can get refund of Special CVD of 4% i.e. ‘K’ above |
|
GOPAL AGGARWAL
(DOING NOTHING)
(1339 Points)
Replied 15 April 2012
Income Tax primer | |||
Labour Laws primer | Economic Laws primer | Corporate Laws primer | Service Tax primer |
General Laws primer | Students Special | Some useful sites | Mr Datey's Books |
Customs Duty - Basics, Types and Calculations Valuation for Import and Export Customs Duty Procedures for Import and Export Baggage, Courier, Postal Articles |
Mohit
(CA)
(755 Points)
Replied 15 April 2012
Thanks a lot Piyush and Gopal.. Really appreciate it... Have got an idea abt SAD finally :)
Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India