Union Budget 2026-27 - Finance Bill, 2026

(a) Specified goods are exempted from SWS vide notification No. 11/2018-Customs. The following changes have been made in notification No. 11/2018-Customs, consequent to omission of certain entries from exemption notifications. The effective duty incidence is unchanged and the following goods continue to remain exempted from levy of Social Welfare Surcharge (SWS). The changes are technical in nature.

(i) Sl. No. 1 of notification No. 11/2018-Customs is being amended to include natural graphite (heading 2504), quartz and quartzite (heading 2506), silicon dioxide (tariff item 2811 22 00), and artificial graphite (heading 3801). Presently, the said goods are exempted from SWS vide Sl. No. 1, 3, 20 and 41 of notification No. 36/2024-Customs91 dated 23.07.2024. Subsequent to the omission of these exemption entries from the notification No. 36/2024-Customs, the said goods will continue to remain exempt from SWS vide modified Sl. No. 1 of notification No. 11/2018-Customs. This change will come into effect from 01.05.2026.

(ii) Presently, all goods under sub-heading 2106 90, excluding compound alcoholic preparations of a kind used for the manufacture of beverages, of an alcoholic strength by volume exceeding 0.5% vol., determined at a temperature of 20 degrees centigrade, attract concessional BCD rate of 50% vide S. No. 67 of TABLE I in notification No. 45/2025-Customs (along with SWS). The exemption entry is being omitted from notification No. 45/2025-Customs and the concessional BCD rate will be shifted to the First Schedule, with effect from 01.05.2026. As a part of consequential changes, Sl. No. 7 of notification No. 11/2018-Customs is being omitted and Sl. No. 1 of notification No. 11/2018-Customs is being amended to include tariff item 2106 90 51 covering compound alcoholic preparations. Incidence of SWS for goods under sub- heading 2106 90 will remain unchanged. This change will come into effect from 01.05.2026.

(iii) Spent catalyst and ash containing precious metals falling under heading 7112 is exempt from SWS vide Sl. No. 54A of notification No. 11/2018-Customs. The description of the entry at Sl. No. 54A is being modified with effect from 01.04.2026 to omit the reference to S.No. 201 of TABLE I of notification No. 45/2025-Customs which is being lapsed on 31.03.2026. The exemption from SWS, vide modified Sl. No. 54A of notification No. 11/2018-Customs, will continue unchanged for spent catalyst or ash containing precious metals.

(b) Social Welfare Surcharge (SWS) will be levied on all goods falling under heading 9804 (all dutiable goods imported for personal use) with effect from 01.04.2026.

(c) Parts of electronic toys for manufacture of electronic toys under S.No. 396 of TABLE I in notification No. 45/2025-Customs are being exempted from SWS with effect from 02.02.2026. Henceforth, all goods under heading 9503 will be exempt from the levy of SWS.

 

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Full Text:

Union Budget 2026-27 - Finance Bill, 2026

Social Welfare Surcharge changes extend specific customs exemptions, add SWS on personal-use imports, and exempt electronic toys. Amendments to notification No. 11/2018-Customs consolidate and preserve SWS exemptions for specified graphite, quartz, silicon dioxide and related items; reassign concessional BCD for sub heading 2106 90 to the First Schedule while retaining SWS incidence; modify the spent catalyst/ash exemption description to remove a lapsed cross reference without altering exemption; impose SWS on all dutiable personal use imports under heading 9804; and exempt parts and goods under heading 9503 (electronic toys) from SWS.