Budget 2026: Indirect Tax Changes | What Gets Cheaper Customs & Excise | GoodReturns

The Union Budget 2026–27, presented on 01 February 2026, announces several Indirect Tax reforms focused on simplifying customs duties, supporting domestic manufacturing, promoting exports, and improving ease of living.

Key Indirect Tax Announcements in Budget 2026
Tariff Simplification & Exemptions
Removal of long-standing customs duty exemptions on items now manufactured in India
Incorporation of effective duty rates directly into tariff schedules for clarity

Export Promotion
Higher duty-free import limits for inputs used in seafood exports
Duty-free imports extended to shoe uppers for exporters
Extended export timelines for leather, textile garments and footwear

Energy & Strategic Sectors
Customs duty exemption for capital goods used in battery energy storage systems
Duty-free import of critical mineral processing equipment
Extension of duty exemptions for nuclear power projects till 2035

Civil & Defence Aviation
Exemption of basic customs duty on aircraft components and raw materials
Special support for defence MRO and manufacturing units

Ease of Living
Customs duty on personal-use imports reduced from 20% to 10%
17 life-saving drugs exempted from basic customs duty
7 additional rare diseases added for duty-free personal medical imports

Trade Facilitation
Faster customs clearance through trust-based systems
Expansion of AEO benefits, AI-based scanning and digital single-window clearance

These measures aim to reduce trade friction, lower costs, support Make in India, and enhance India’s role in global supply chains.


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