Highlights of Union Budget 2025–26
1.2.25
Members of the Council
Dear Member
Kindly find below the highlights of the Union Budget 2025-26 presented by Hon’ble Finance Minister Smt. Nirmala Sitharaman today
- Focus Product Scheme for Footwear & Leather Sector : To enhance the productivity, quality and competitivenessof India’s footwear and leather sector, a focus product scheme will be implemented. The scheme will support design capacity, component manufacturing, and machinery required for production of non-leather quality footwear, besides the support for leather footwear and products. The scheme is expected to facilitate employment for 22 lakh persons, generate turnover of `Rs.4 lakh crore and exports of over Rs.1.1 lakh crore.Further details of the scheme will be circulated as and when notified by the Government.
- Basic Customs Duty (BCD) is being reduced from 10% to Nil on Wet Blue leather import with effect from 2nd February 2025 [ S.No. 284A of Notification No. 50/2017-Customs dated 30th June ,2017 as amended by Notification No.5/2025-Customs, dated 1st February, 2025 refers.]
- Export duty is being reduced from 20% to Nil on crust leather with effect from 2nd February 2025 [S.No. 25J of Notification No. 27/2011-Customs, dated 1st March, 2011 as amended by Notification No.3 /2025-Customs, dated pt February, 2025 refers.
- The import duty i.e. tariff rate is being reduced from 35% to 20% on footwears classified under headings 6401, 6402, 6403, 6404 and 6405. These changes will come into effect from 1st May, 2025. [Clause 98(b) of the Finance Bill, 2025 read with Third Schedule refers]. However, w.e.f 2nd February, 2025 these goods will attract 20% BCD and 18.5% Agriculture Infrastructure and Development Cess (AIDC) + Nil Social Welfare Surcharge (SWS) [S. No.8 of Notification No. 4/2025 Customs, dated 1stFebruary, 2025 and S. No.14A of Notification No. 6/2025-Customs dated 1st February, 2025 and S.No. I(ii) of Notification No. 7/2025-Customs, dated 1st February, 2025 refers].
- Members are aware that import duty exemption is provided to notified inputs for exporters of leather garments, footwear and other leather products under IGCR (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) scheme. Changes to IGCR Rules, 2017 Rules 6 and 7 are being amended to increase the time limit for fulfilling end use from current six months to one year. Further, the importers will now have to file only a quarterly statement instead of monthly statement. Customs Notification No. 7/2025 (Non Tariff) dated 2.1.25 may be referred.
Members may note the above.Copies of aforementioned Customs Notifications are enclosed herewith.
With kind regards
Selvam
Executive Director