Definition
Basic Customs Duty
Basic customs duty is the primary tariff levied on imported goods as a percentage of their assessable value, forming the core of India's import tax.
Basic customs duty (BCD) is the foundational import tariff, set product by product in the customs tariff schedule and amended in the Budget. It is calculated on the assessable value of imported goods and is the rate most often referenced when discussing whether imports of a product are being made cheaper or costlier.
Governments adjust BCD to balance competing goals: protecting domestic producers, keeping essential imports affordable, and supporting initiatives to deepen local manufacturing. Changes in BCD on items like electronics, metals and edible oils are closely watched by affected industries.
Related terms
- Customs DutyCustoms duty is the tax levied on goods imported into, or in some cases exported from, India, administered under the Customs Act.
- Anti-Dumping DutyAnti-dumping duty is a protective levy imposed on imports priced below their normal value to shield domestic industry from unfair foreign competition.
- PLI SchemeThe Production Linked Incentive scheme offers financial incentives to manufacturers based on incremental sales of goods made in India, to boost domestic production.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.