Soon your duty-free liquor purchase limit at an international airport may be reduced from a maximum of two litres to just one if the Commerce and Industry Ministry has its way. Not only that, cigarettes may altogether go off the shelves at airports. These recommendations are a part of the proposal made by the Ministry of Commerce for the forthcoming Budget 2020 to reduce import of non-essential goods. Budget 2020 will be unveiled by Finance Minister Nirmala Sitharaman on February 1.
The commerce ministry has also reportedly made suggestions to increase the import duty on as many as 200 items, including paper, footwear, rubber items and toys to promote 'Make in India' and reduce unnecessary usage. "This is part of our drive to reduce unnecessary imports. We have also recommended to the finance ministry a hike in duties on 200 items we consider non-essential," a commerce ministry official told Mint on condition of anonymity.
Contrary to the Centre's intention, the airport operators' association has proposed doubling baggage allowance to Rs 1 lakh from the current Rs 50,000, which they say it will increase foreign exchange earnings. They think that airport operators would be the most hit due to the decision as people would eventually move to other competing nations like Singapore, Malaysia and Dubai.
A duty-free shop is where an inbound international passenger can generally purchase goods worth about Rs 50,000 without paying any import duty. The measure is also a part of the Centre's long-term plan to narrow down fiscal deficit. It could also pave the way for a boost in manufacturing exports and more jobs on the domestic front. Notably, duty-free shops are licenced under Section 58 of the Customs Act, 1962.
If implemented, the airport operators would be quite unhappy with the move, because they had sought an increase in the liquor-purchase limit to 4 litres from the current 2 litres.
The Centre for Asia-Pacific Aviation sees duty-free spend at Indian airports hitting $1.6 billion by 2021 or Rs 10,600 crore. Of the 17 international airports boasting duty-free outlets, New Delhi's Indira Gandhi International Airport (IGIA) has pretty much ruled the roost since it houses the country's largest duty-free retail space.