In an attempt to stem e-commerce shipments from Southeast Asia and China which are wrongly declared as ‘gifts’ to evade duties, the government is reportedly considering removing the provision altogether, the Economic Times reported. Earlier, the Central Board of Indirect Taxes and Customs had considered just limiting the number of gifts an individual could receive, but then decided against it given its difficult implementation.
In July 2019, courier terminals at Bengaluru and Delhi had stopped clearing parcels under the CB-12 (gifts and samples) route which allowed individuals to receive free samples and gifts up to ₹5,000 in value without paying any duties. Mumbai Customs took action in January 2019. These three ports account for 90% of such imports.
Although other ports were notified to ensure that Chinese e-commerce vendors did not start using them instead to circumvent the ban, that shift has not been seen, the ET report said. But, other firms have started acting as intermediaries between customers and Chinese e-commerce companies, to avoid paying higher duties that personal imports attract.