Government may put curbs on sale of liquor, cigarettes at duty-free shops
India allows inbound international passengers to buy two bottles or two litres of alcohol, and one carton of cigarette from duty-free shops.Updated: Jan 20, 2020 06:52 IST
The government is considering a proposal of the commerce ministry to reduce the permitted quantity of tax-free foreign liquor and cigarettes purchased from a duty-free shop in line with the practice followed by countries such as the United States, China, South Korea and Singapore, two officials with direct knowledge of the matter said, requesting anonymity.
The officials said the proposal was part of the larger exercise to curtail import of non-essential goods into the country.
“This measure is not for revenue considerations. Both liquor and cigarettes are sin products and should be discouraged. There is no point that India should be more liberal than countries such as the US, China and Singapore in allowing greater duty-free access to sin goods,” the first official mentioned above said.
According to the official, the proposal is based on an internal study. “The US allows one litre of alcoholic beverage and China allows 1.5 litres. In case of South Korea, it is confined to one bottle of one litre, with the value not exceeding $400,” the official said.
“Singapore does not allow passengers to carry cigarettes without paying duty. Australia allows 25 cigarettes and New Zealand 50. Why should India be more liberal?” the official added.
India allows inbound international passengers to buy two bottles or two litres of alcohol, and one carton of cigarette from duty-free shops. These shops are located at airports allowing passengers to purchase goods worth about Rs 50,000 without paying any import duty.
Various ministries send proposals for the budget, a second official said, adding that all proposals are examined by the finance ministry but not all are accepted.
Finance minister Nirmala Sitharaman will present the Union budget 2020-21 on February 1.
Spokespersons of the finance ministry and the commerce ministry could not be contacted immediately for comment.
The commerce ministry has also suggested an increase in customs duty on several products such as paper, footwear, rubber items and toys to promote “Make in India”, and boost manufacturing growth, officials said.
The ministry has also proposed to rationalise import duties on more than 300 items from different sectors, including furniture, chemicals, rubber, coated paper and paper boards, the officials said.