India's Customs Act Revamp: Streamlining Trade and Boosting Business Predictability

The financial ministry's proposal to set a two-year limit for finalising provisional assessments addresses delays in customs processes. The initiative aims to enhance business predictability and ease cash flow for companies by aligning with global standards. Additionally, voluntary compliance schemes and extended deadlines aim to optimize trade operations.

India's finance ministry is set to transform trade operations by proposing a fixed timeline for provisional assessments in the Customs Act. The initiative aims to resolve long-standing delays and uncertainties for exporters and importers.

Under the new proposal outlined in the Budget, a two-year time limit, extendable by one year, will be set for finalising provisional assessments of export and import consignments. Economic analysts at the Global Trade Research Initiative (GTRI) predict this move could enhance predictability for businesses.

This step is part of broader efforts by the ministry to streamline customs procedures, improve compliance, and enhance India's reputation as a trading hub. By extending deadlines and promoting voluntary compliance, the new measures promise to reduce disputes and encourage smoother financial planning for businesses.

(With inputs from agencies.)