MUMBAI: In a win for the

scientific community

, the

finance ministry

has rolled back a

customs duty

hike levied on

lab chemicals

. In the recent Union budget, government had hiked customs duty on laboratory chemicals from 10 per cent to 150 per cent , throwing

research

budgets astray.
TOI, on July 31, had reported that customs duty on close to 40,000 items had swelled from 10 per cent to 150 per cent .

Late on Wednesday, finance ministry said that all chemicals, barring undenatured ethyl alcohol, meant for research and development will continue to attract 10 per cent customs duty.
It said, the “amendment” in the notification was made in “public interest”. The notification came into force on Thursday. Additionally, a penalty clause has been drawn up for those trying to import these chemicals fraudulently as meant for research.
The importer has to submit an undertaking before the deputy commissioner of customs or the assistant commissioner of customs that the goods imported shall be for use in laboratories or for research and development purposes “and shall not be sold or traded after import”.

If the chemicals are found in use for other purposes, the higher rate of customs duty will be levied.
The amendment slashing customs duty was welcomed by the scientific community. Govt sources said most chemicals attract duty of 2.5 per cent , 5 per cent , 7.5 per cent , or 10 per cent . “Some importers were importing undenatured ethyl alcohol after mis-declaring them as lab chemicals to circumvent 150 per cent duty on undenatured ethyl alcohol. To curb this misuse, in budget 2024-25 the BCD on lab chemicals under CTH 9802 was increased to 150 per cent .”
“However, to address concerns of genuine users, Basic Customs Duty on lab chemicals under CTH 9802 (excluding undenatured ethyl alcohol of any alcoholic strength) for use in laboratories and for research & development purposes has been reduced to 10 per cent .”