What Is the Difference Between IGCR and Regular Customs Duty?

The Import of Goods at Concessional Rate of Duty (IGCR) Scheme and regular customs duty differ mainly in purpose, applicability, and compliance requirements.

1. Applicability

• Regular Customs Duty: Applies to all importers bringing goods into India, based on the standard customs tariff.
• IGCR: Applies only to eligible importers who use imported goods for specified purposes such as manufacturing, job work, or production, and who comply with IGCR Rules, 2017.

2. Duty Rate

• Regular Customs Duty: Importers pay the full rate of customs duty as per the Customs Tariff Act.
• IGCR: Importers get concessional duty rates (reduced or zero duty) for eligible goods, lowering overall costs.

3. Purpose of Import

• Regular Customs Duty: No restriction on end use; goods can be used or sold freely once cleared.
• IGCR: Imported goods must be used strictly for the declared purpose (e.g., as raw material for manufacturing). Diversion or misuse is not allowed.

4. Compliance Requirements

• Regular Customs Duty: Standard filing of Bill of Entry and payment of duty—no additional compliance beyond customs clearance.
• IGCR: Requires prior intimation to customs, maintenance of detailed records, and periodic reporting of consumption and usage.

5. Objective

• Regular Customs Duty: Revenue collection for the government.
• IGCR: Trade facilitation—supporting domestic manufacturing, reducing costs, and promoting “Make in India.”

In summary, regular customs duty is the default tax on imports, while IGCR is a concessional scheme designed to encourage industrial use of imports under specific conditions.

Learn more about IGCR at https://www.jparks.co/services/apply-for-igcr-clearance/