CBIC introduces liberalised customs duty package for MSMEs
14 Jan 2021
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The Central Board of Indirect Taxes and Customs (CBIC) has introduced a liberalised package for micro, small and medium enterprises (MSMEs), allowing them to become Authorised Economic Operators (AEOs) and avail of the various benefits, enjoying relaxed the compliance criteria.
MSMEs that have a valid certificate from their respective ministries are eligible for the flagship `Liberalised MSME AEO Package.’
CBIC said the new initiative is intended to encourage MSMEs in view of their critical contribution in supporting the economy, especially during the present difficult times of Covid-19 pandemi.
The relaxed requirements allow MSMEs that have filed minimum 10 customs clearance documents in one year and have a clean compliance record over 2 years to apply for the scheme. The documentary requirements have also been simplified.
CBIC also commits to take a decision on an application for grant of AEO status within 15 days from electronic submission of complete documents for AEO Tier T1. Additional benefits, like further reduction in bank guarantee requirements, have been introduced for MSMEs, and will be expanded subsequently.
The `Liberalised MSME AEO Package’ scheme is a voluntary compliance programme which enables swifter customs clearance for accredited stakeholders in the global supply chain, viz. importers, exporters, logistic service providers, custodians etc.
The approved AEOs derive various benefits including the facility of Direct Port Delivery (DPD) of imported containers, Direct Port Entry (DPE) of their Export Containers, high level of facilitation in customs clearance of their consignments, exemption from bank guarantees, priority for refund/ rebate/ duty drawback, as well as a client relationship manager at the customs port as a single point of interaction.
Besides, specified AEOs can avail of deferred payment of customs duty instead of prior payment for clearance of imported goods by customs. For Tier 2 AEOs, their exports to certain countries will be accorded facilitation by the foreign customs administration with whom India enters into a mutual recognition agreement/arrangement.
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