CBIC is likely to soon introduce a system of publishing daily currency exchange rates on the Unified Customs Portal, replacing the existing system of fortnightly notified rates.
This move will help in capturing daily exchange rate Fluctuations and helps importers and exporters to calculate customs duty accurately based on the daily exchange rate.
Currently, the Central Board of Indirect Taxes and Customs (CBIC) manually notifies the exchange rates of 22 currencies every fortnight – on the first and third Thursday of the month – based on the rates received from the State Bank of India (SBI). The notified rate is applicable from the midnight of the next day.
An official said the entire process would be automated, starting with SBI forwarding the exchange rate data to ICEGATE.
The exchange rates received from SBI daily will be adjusted to the nearest five paise and integrated with the Indian Customs EDI System (ICES) and published on the Indian Customs National Trade Portal (ICEGATE) by 6:00 PM.
“In order to keep a close tab on the exchange rate movements, CBIC has decided to publish the exchange rates of 22 currencies on the ICEGATE website on a daily basis,” the official told PTI. Stakeholder consultations are on and the system will be rolled out soon.
As per the scheme, on holidays when SBI does not publish the rates, the prevailing rates will be applicable on the following day.
At present, after fortnightly notification, if exchange rate of a currency If there is a fluctuation of more than ±5 percent, then the rate of that currency is notified again from the next day.
Experts said the benefits of the proposed system for determination and publication of exchange rates on a daily basis would enable importers and exporters to take more informed decisions regarding their transactions. Exchange rates will be more accurate and reflect current market conditions and will be time efficient.
The new system includes a contingency plan in case of a technical glitch or failure in electronic transmission, which ensures uninterrupted access to exchange rates at any time.
Rajat Mohan, senior partner, AMRG & Associates, said this would help check miscalculation of customs duty arising out of fluctuations in exchange rates.
“For small consignments the daily floating exchange rates would be marginal, but for large consignments the tax difference could be huge.
This change indicates that the Indian economy is becoming digital in every sense as compared to other developed countries.
The text of this story is published from a wire agency feed without any modification. Only the headline has been changed.
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