#tax and duty calculater

[thehourmarkers]

A Comprehensive Guide For Calculating Customs Duty On Watches Imported In India

The world of watches, adorned with craftsmanship and precision, often finds itself traversing the boundaries of nations, unveiling a fascinating interplay of customs duties. The allure of a finely crafted timepiece is met with an intricate web of customs regulations. Across countries, a different plethora of duties awaits those who seek horological treasures.

Introduction to Customs Duty

Customs duty on imported goods, including watches, plays a pivotal role in regulating trade and protecting domestic markets. For importers, an accurate calculation of the customs duty is imperative. It directly influences the total expense of importing goods thereby affecting overall profitability.

We will offer an all-encompassing guide on the intricacies of computing customs duty for imported watches in India. It will elucidate the various categories of customs duty, delve into the influencing factors of the calculation and furnish practical tips and examples to enhance your understanding of the procedure.

Luxury watches imports in India grew over 21% in the first half of 2023 reaching $100 million, reported by Mint

Types of Custom Duties Applicable on Watches

In India, imported watches are subject to customs duty in accordance with the Customs Act of 1962 and its associated regulations. This encompasses a spectrum of duties, including but not limited to the following:

Basic Customs Duty (BCD):

The BCD is a percentage-based duty applied to the assessable value of the watch. The assessable value of the goods is determined by summing the cost of the item/s along with the incurred expenses for insurance and freight during the transportation to India.

Customs AIDC:

The Agriculture Infrastructure and Development Cess (AIDC) is imposed on certain goods including wristwatches when imported in India.Top of Form

Additional Customs Duty (ACD):

Additional Customs Duty or Countervailing Duty (CD) is imposed at a rate equivalent to the applicable excise duty on similar goods manufactured in India. It is calculated on BCD.

Social Welfare Surcharge (SWC):

SWC is imposed at 10% of the combined amount of duties, taxes and cesses. This surcharge is intended to bolster the Government's dedication to enhancing education, healthcare and social security initiatives.

Integrated Goods and Services Tax (IGST):

IGST is a tax levied on the total value of the imported watch. It is calculated as 18% of the assessable value plus the duties, taxes and cesses.

Swiss luxury timepieces have captured the interest of enthusiasts across India and esteemed brands seize the flourishing market prospects to attract sales with exclusive timepieces, such as this Vacheron Constantin Overseas Timepiece for India

Calculating Customs Duty for Watch Imports

To compute customs duty for imported watches in India, importers must furnish essential documents, including the bill of entry, invoice, packing list and insurance records. Subsequently, customs authorities assess the value of the goods, such as the assessable value and CIF (Cost, Insurance and Freight), to determine the applicable customs duty.

Similar to various asset classes, Indians are presently making substantial investments in luxury watches. Timepieces like the Patek Philippe 5236P with an in-line display perpetual calendar offer attractive ROI. Despite a 25% price increase for luxury watches in India, the demands face a consistent surge

Similar to various asset classes, Indians are presently making substantial investments in luxury watches. Timepieces like the Patek Philippe 5236P with an in-line display perpetual calendar offer attractive ROI. Despite a 25% price increase for luxury watches in India, the demands face a consistent surge

Factors Influencing Calculation of Customs Duty

The calculation of customs duty is a nuanced process influenced by a myriad of the following factors:

Value of the Item:

The value of the imported item is ascertained by combining the expenses related to the goods, encompassing the cost of the item, insurance charges and the freight charges associated with its transportation to India.

Country of Origin:

As certain nations hold distinct trade agreements and tariff rates with India, the country of origin influences the customs duty calculation.

Classification of Items:

The Harmonized System of Nomenclature (HSN) codes are used to classify goods imported in India. Wristwatches are specifically categorized under clocks and watches and parts thereof.

Their classification as Tariff Item HSN codes 9101 / 9102 and standard rates of duty are defined as under:

Source, Central Board of Indirect Taxes & Customs

Steps for Calculation of Customs Duty for Watches Imported in India

Here is a step-by-step guide on how to calculate the applicable custom duty levied on wristwatch imports:

Determine the Assessable Value of the wristwatch or its CIF:

This is derived by summing the cost of the items, along with the incurred insurance and freight charges.

Identify Applicable Customs Duty Rates and GST Duty:

Identify the applicable Basic Custom Duty (BCD), Customs AIDC, Social Welfare Surcharge (SWC) and IGST Levy based upon classification as per HSN codes.

Calculate Duty:

Calculate the Total Duty percentage by adding all applicable custom duty rates.

The Indian Customs Electronic Gateway (ICEGATE) portal offers a calculator for determining the structure of duty for wristwatches.

Here is a sample calculation of customs duty of a wristwatch imported in India from Switzerland with an assessable value of Rs. 2,00,000:

 Total Duty Amount on a wristwatch import with Assessable Value of Rs. 2,00,000:

Source, Central Board of Indirect Taxes & Customs

Basic Customs Duty (BCD) + Customs AIDC + Social Welfare Surcharge (SWC) + IGST Levy

20% (of assessable value) + 20% (of BCD) + 20% (of BCD + AIDC) + 18% (of assessable value + BCD + AIDC + SWC)

40,000 + 8,000 + 4,800 + 45,504 = 98,304 or 49.152% (of assessable value)

Import Duty Exemptions

There might be exemptions or reduced duties for certain categories of watches, based on trade agreements or specific government policies.

Influence on the Watch Market

The imposition of customs duty holds the power to steer the direction of the watch market. Whether it prompts a surge in the demand for domestic alternatives or continues to drive the pursuit of international luxury timepieces is a fascinating aspect to observe.

In 2021, luxury watch imports experienced a notable 19% growth, propelling India beyond nations like Kuwait, Ireland, Bahrain, Belgium, Portugal, Greece and Malaysia. However, waiting periods for sought-after brands such as A. Lange & Söhne persist, extending into periods of months or even years

Impact on Collectors and Enthusiasts

For those passionate about horology, customs duty becomes a pivotal consideration in the pursuit of their coveted timepieces. Some might explore avenues to acquire their desired watches within the confines of duty regulations, while others may weigh the options differently.

The pursuit of an exquisite timepiece isn’t merely about its mechanics or brand - it’s a narrative woven with passion, regulations and the essence of time itself.

[wrotetheaboveoftoday]

1828 Sun. 7 September (3/3)

Third letter of the day, this one to Mariana

Anxious about M- [Mariana]’s health - wish to hear oftener than usual - hope to be off on or about the 20th but of this she shall hear further by and by when I see how we go on - begin tomorrow to take down the hall wall - ‘have written to Miss McL- [MacLean] to take a little more time then till the 6th or 7th of October for meeting her in London’ Isabella can say nothing - ‘we have got another room upstairs in Paris .... and, as it were, another servant too’ - Mrs. D- Duffin says, the N-s [Norcliffes] expected this week or next - ‘How shall I be off going to L- [Lawton] for 2 or 3 days?’ Mention having got a Doublefente Cafetiére, and roaster for her supposing Mr. C.L- [Charles Lawton] to like coffee -

Determined to take Martha, if my aunt does not object - can I take her with me to Lawton, or must she be left here till I return; for return I must for 2 or 3 days - M- must dress her up for me - heartily glad they have given up the festival - Mr. John L-’s [Lawton]’s conduct

“passing strange - he must little know the parties he has to deal with, if he can fancy, for a moment, such conduct likely to do him any good - But do you seem to take as little notice of it, as you can - leave the gentlemen to settle it - your shewing any impatience, can profit nothing - Mr. Williams will, of course, advise Mr. C. L- [Charles Lawton] what to do - I will not enter more largely on the subject now, as I shall see you so soon”

Mention having heard from Miss Pickford and that she is bound for north and south Italy and Germany felt a little pain in my back so lay down at two and three quarters for an hour dozed but not slept I had this pain last sunday monday and tuesday a little and it then went off - Lay down for an hour at 2 3/4 - then from 3 3/4 to 5 1/4 wrote all but the first 6 lines of today - at 5 1/2 was just closing my letters when Cordingley brought in a small round deal box from Lawton containing 2 partridges and 27 peaches, and 4 pp. pages and one end

Pi [Mariana] in very low spirits Lou cannot spend the winter with her now if this is the case I believe I must go for two months of it tat least to Scarbro for indeed I cannot spend it here alone ...... My spirits are so completely shattered that I am not fit to be left much to myself  I do all I can to struggle against lowness but spite of myself it daily increases and I am sure my mind if not my life will be sacrificed if I have such another winter as the last - M- wishes we would take the Pattisons’ house or the Salmons:

“Either I think would suit you, the air is good and healthy, your aunt would have as much society as she liked, you might have - for 2 or 3 days at anytime and you might be from home as much as you pleased, for your aunt might then either be here or I with her, or at all rates I should see her most days, and you would not be far from Shibden - it has been my daydream and nightdream for some time past”

Poor Pi [Mariana] said I to myself I am not what I used to be  You might have your own for two or three days etc.  Would not repay me for my liberty and being near Shibden is what I would avoid but afterwards mused a little upon delta [Charles] letting us have the place rent free but ah thought I we are better where we are it would be humdrum and stupid and I could not leave England Pi [Mariana] could not now make up to me for all this besides the expense of the thing - sat down immediately and erased the 2 first pp. pages of my paper - (she had been discomposed by C-’s [Charles]’ great wish and determination to go to the festival tho’ she had written to give it up) - said their going to the festival would not make her lose any of my society - might perhaps be better not to go at all till I had got all done - if I had gone on the 20th must have returned here - must go too, probably for 2 or 3 days to Langton - bade her cheer up - I would think of all she wished, but she must help me to think whether the spring plan could be put in execution or not - on this, too, must much depend my own plans

At all rates, not to go to Scarbro’ for 2 months - this would eat up all proper leave of absence - She must write soon, and tell me her opinions candidly about the Spring plan (her going to Italy with me) - whatever they might be, I would continue - my wits had never yet forsaken me in time of need, why should they now? I would almost move heaven and earth to gain her as far as possible all that would suit her best - go to the festival with a good grace, and a light heart - I should now be better satisfied to have her there - If Lou could not spend the winter with her, not to mind - I would try to manage, and make up to her for it - only to cheer up - this all I asked at present - would send the pattern chemise tomorrow or Tuesday - should like to have one dozen chemises exactly like the pattern

Poor Pi [Mariana] the thought struck me to send Miss MacLean to her I must think about all this when shall I get back to Paris again off what will be the end of all this - Dressed - went down to dinner at 6 3/4 - sealed and sent off at 7 my letter to ‘Mrs Lawton, Lawton hall, Lawton Cheshire’ and to ‘Miss McL- [MacLean] of Coll, Coll house, Aross, N.B.’ and my note to Mrs. Wilcock, Saville hill - Kind, civil Note from Mrs. Wilcock she had written to Geneva - meant to have written to Vienna, but after what I wrote will wait to hear from Miss P- [Pickford] again - would have been very glad to see me - in fact, knows no more than I do - my father read aloud 1 of Mr. Knight’s sermons - from 9 to 9 50/60 wrote the whole of this page but the 1st 8 lines - Rainy morning - fine day from about 11 a.m. to night - came to my room at 10 10/60 having been downstairs 20 minutes

(in margin, halfway up page)

my fath[e]r and I calculat[in]g taxes aft[e]r din[ner] for

2 horses - 4.14.6       3 horses -5.14.0

2 manserv[an]ts - 13.0.0        3 serv[an]ts - 7.6.3

2 carriages - 3.2.0        House duty at £40 rent and upw[ar]ds, p[e]r ann[um] 2/10 in the [k[i]nd] = pay[in]g £100 a y[ea]r rent nearly £15 per ann[um] 

25 windows - 7.14.3