merit rate of duty

[rajkumar shukla]

What is merit rate of duty which finds mention in TRU D.O.letter relating to excise `budget proposals?Has this been defined any where?

[ALOK GUPTA]

Please intimate the specific place where term "" Merit rate  " is mentioned in Budget  proposals

[rajkumar shukla]

please see para 3.4 of  DO of J.S TRU-1  wherein this reference is available.

[Vijay kumar]

Dear Sir, merit rate means the effective rate of duty applicable for the goods in question. This has not been defined in the Tariff Act or the notifications, but is generally used to indicate the applicable rate of duty. Presently, the tariff rate is 16% and the merit rate is 12% for most of the goods. If we see the exemption notifications eg. 18/2012 or 12/2012 CE, they exempt the goods over and above the rate specified therein and the word "merit rate" or "effective rate" is not used specifically. Hence these words are for common understanding only.

AI Summary

Merit rate of duty denotes the effective excise rate for goods, used administratively though not statutorily defined.
The merit rate of duty denotes the effective excise rate applicable to particular goods and is a colloquial administrative term without statutory definition; it appears in TRU budget-related correspondence to indicate the operative duty level considered for policy proposals, while exemption notifications typically specify relief without employing the phrase "merit rate."