NEW DELHI: In a bid to give boost to the local manufacturing in the maritime sector, finance ministry is likely to raise basic customs duty (BCD) on certain items in the upcoming budget 2024-25, top sources told The New Indian Express.
Custom duty on fishing vessels, tugs and pusher crafts and light vessels may be raised from 5% to 50%.
“The Ministry of Shipping has made a proposal and the Centre may make an announcement in the Budget to be released on July 2024. They have proposed to raise rates on fishing vessels, tugs and pusher crafts and light vessels to 50% for next ten years and thereafter increase it to 100% from the year 10-25,” a top governments source stated.
He added that this is in line with the recommendations of Maritime India Vision 2030 (MIV 2030) launched by the Prime Minister in 2021 - wherein detailed deliberations were conducted with shipping ministry and central line ministries, maritime experts, shipbuilding associations and think tanks etc.
For lifeboats, basic customs duty may be imposed at 50% for next 10 years and 100% in 10-25 years. BCD is expected to rise to 50% on barges or pontoons imported along with ships for the next 10 years and thereafter increase it to 100% from the years 10-25. A few months ago, the government had to reverse its decision of imposing import restrictions on laptops due to criticism from the industry and the US.
The Centre may announce production linked incentive scheme for container manufacturing. Implementing a PLI scheme for this will incentivise domestic production by offering financial incentives based on volume and value addition criteria.
This will attract investments from domestic and global manufacturers to set up facilities in India, as per the source. The Centre may eliminate tax deducted at source (TDS) for Indian seafarers working on Indian flagged vessels operating in coastal waters to level the playing field with foreign-flagged vessels.
The extension of benefits under the Tonnage Tax scheme to Inland Vessels registered under the Inland Vessels Act, 1917, may also be announced to spur investment in the IWT sector.