Budget 2020: Duty-Free Alcohol, Cigarette Purchase May Be Restricted

As part of its recommendations for the upcoming Union Budget, the commerce ministry has suggested restricting the purchase of alcohol at duty-free shops to 1 litre as part of steps to reduce import of non-essential goods, said a PTI report citing sources.

The report further said that the ministry also recommended prohibiting the purchase of cigarette cartons at duty-free shops.

Currently, inbound international passengers are allowed to buy two litres of alcohol and a carton of cigarettes at these shops. These travellers are allowed to purchase goods worth about Rs 50,000 without paying any import duty.

The commerce ministry's suggestion assumes significance as the government looks at ways to tame trade deficit by curtailing import of non-essential goods into the country.

According to the PTI report, sources said that there are countries that only permit purchase of 1 bottle of liquor to its international passengers and it was suggested that India should the same.

Further, suggestions were made to increase customs duty on several products like paper, footwear, rubber items and toys to promote "Make in India" and boost manufacturing growth.

Rationalisation of basic customs or import duty has also been proposed by the ministry on over 300 items including chemicals, furniture, rubber, coasted paper and paper boards.