Export-oriented units operating in Special Economic Zones (SEZs) have written to the Ministry of Commerce and the Revenue Department of the Finance Ministry seeking clarity on the levy of concessional duties for supplies made to the Domestic Tariff Area (DTA), amid growing uncertainty over interpretation of the newly made rules, told industry sources aware of the matter.
Several SEZ units have flagged multiple problems being faced by companies while supplying goods to the domestic market. Stakeholders say ambiguity around applicable duties and procedures is leading to compliance challenges and delays. Previously, SEZ had flagged that the concession granted to sell goods in the domestic market at lower customs duty for one year is not adequate, and sought a higher cap of 50% on domestic sales against 30%.
“The window is just for a year and it got effective just a day after the announcement came. Even to avail the concessions, the process is long and the certification takes time. The SEZs cannot implement the change overnight. Also, there is lack of clarity on several points,” said the
source.
Based on industry feedback, a consolidated list of concerns has been prepared and shared with CBIC and the Department of Commerce (DoC). “A compilation of doubts/difficulties which need to be clarified by DoC/CBIC has been made,” the source added.
As a one-time move, the Finance Ministry has announced that the SEZ units will be allowed to increase sales in the domestic market with customs duty concessions. The move is aimed at supporting exporters grappling with weak global demand. The concessions will be effective from April 1 and will remain valid for a year until March 31, 2027. However, only units that commenced production on or before March 31, 2025, can avail of the benefit.
The Union Budget 2026–27 introduced a key one-time measure allowing SEZ manufacturing units to sell goods in the DTA at concessional duty rates.