White goods, FMCG imports failing to get custom-fit tag
White goods, chemicals, pharmaceuticals and FMCG companies are faced with import delays or higher duties as customs authorities at various ports are holding up import consignments over third party invoicing, people familiar with the matter said.
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Multinational companies typically employ third-party invoicing for ease of sourcing and tax optimisation — billing is through a nation other than the country of origin of the exported goods. Third-party invoicing is permitted under free trade agreements (FTAs).
While such invoicing is possible for any import, the maximum instances are seen in the cases of white goods, fast-moving consumer goods (FMCG), and chemicals and pharmaceuticals.
Customs authorities have started closely looking at such imports and have withheld consignments over concerns that FTA provisions are being abused — goods routed through countries with which India has a trade agreement and therefore eligible for lower import duty. They have denied clearance or FTA duty benefits at several ports, including Nhava Sheva, India’s second-largest container port located in Navi Mumbai.
“Clearances have been blocked… it could lead to supply issues,” said a person familiar with the development.
A mail sent to the finance ministry spokesperson and the Central Board of Indirect Taxes and Customs did not elicit any
