Union Finance Minister Nirmala Sitharaman announced an overhaul of India’s customs system to simplify procedures and reduce tariff rates. Experts argue that tariff rationalization should be a high priority, as customs duty now contributes only about 6% of total tax revenue. The current system is criticized for being slow and opaque, with scattered information that often hinders business growth.
Recommended reforms include collapsing all charges (basic duty, cess, and surcharges) into a small number of final duty bands. A single searchable national portal or online calculator for total payable duty is also suggested to eliminate confusion and reliance on intermediaries. Furthermore, simplifying customs communication by making every notification self-contained and written in plain language is considered essential.
Technological upgrades are also needed, such as moving from scanned documents to structured machine-readable data submissions. Other proposed changes include standardizing Direct Port Delivery and ensuring every override of the automated Risk Management System (RMS) is digitally logged and auditable.