FinMin should review DRI demand for social welfare surcharge

The law is quite clear that SWS is to be calculated at the rate of 10 per cent on the BCD levied and collected

Exporters and importers have a new problem. The Directorate of Revenue Intelligence (DRI) is asking them to pay Social Welfare Surcharge (SWS) on imported goods that are subject to ‘nil’ basic Customs duty (BCD) or fully exempted from BCD through a notification.  

The demand includes SWS on goods imported since the levy was introduced on February 2, 2018, under advance authorisations, Export Promotion Capital Goods (EPCG) authorisations, and various notifications giving effect to Free Trade Agreements (FTAs).

SWS is levied through Section 110 of the Finance Act, 2018, which prescribes its calculation, for all practical purposes, at 10 per cent of BCD