Zero customs duty on digicams

Zero customs duty on digicams

New Delhi, Sept. 18 In a major relief to the industry, the Finance Ministry has clarified that flat panel monitors and digital cameras will be treated as IT products with nil customs duty, although this will not mean any change in product prices for the end consumers.

The Customs authorities were earlier assessing the two products at 10 per cent Customs duty, and the clarification assumes importance as it puts an end to several disputes on interpretation of the applicable rate on these items.

“The clarification has a far-reaching consequence as several developed countries including the EU and other Asian countries such as China have been unable to resolve the classification issue and continue to classify them as non-IT products,” Mr Vinnie Mehta, Executive Director of MAIT, said.

The Government has clarified that flat panel monitors were computer monitors (IT product) and not LCD TVs. Similarly, owing to the video clip recording facility, digital cameras were earlier being classified in the same category as ‘camcorders’ with 10 per cent customs duty.

No change in prices
However, there would not be any change in the cost of the products because leading vendors were furnishing bank guarantees and clearing the products at a nil customs duty subject to clarification from the Government.

According to Mr Alok Bhardwaj, Vice-President, Canon India, most of the leading vendors had already dropped prices for these products and hence the price tag will remain unchanged.

“Prices were already factored at the lower level. However, the clarification puts things in black and white,” Mr Ravi Swaminathan, President – Personal Systems Group, HP India, said.