Kolkata, Jan 2 (KNN) Amid ongoing speculation of rising import duty on IT and network communications device, the Union Finance Ministry has clarified that routers will continue to enjoy zero import duty status as no Basic Customs Duty (BCD) will be levied on these products till any further notification

"Router being an IT product covered by Information Technology Agreement (ITA-I), it was expected a notification would be issued granting exemption from basic custom duty, to router, on account of change in classification within Heading. Accordingly, a notification has been issued now, being Notification No. 36/2019-Cus., dated 30.12.19, amending parent Notification No.24/05-Cus.,by substituting Sr. No.13N,’’ a finance ministry notification said.

Earlier, telecoms had urged the finance ministry to clear the air on whether routers would attract BCD after the government reclassified the device under the Finance Act (No. 2), 2019, and the Central Board of Indirect Taxes and Customs last month set January 1, 2020 as the implementation date for new clauses.

Citing Technology Agreement (ITA) of World Trade Organization pact, phone companies had warned that imposition of BCD as routers are among 200-odd items under ITA-1 on which signatories, including India, have pledged to eliminate customs duties.

Since, the finance ministry had not specified the new HS codes for continuing duty-free import of routers following the reclassification. This had triggered uncertainty over future purchases and associated import costs of these devices for procurements from overseas vendors.

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