While addressing a virtual event organised by the PHD Chamber of Commerce, NITI Aayog member V.K. Saraswat on June 10, 2020 favoured imposing a border adjustment tax (BAT) on imports to provide a level-playing field to domestic industries.
Reason: U.S.-China trade tensions are currently at historically high levels and it is expected to rise further. In this context a border adjustment tax to provide the domestic industry a level-playing field vis-a-vis imports.
What is Border Adjustment Tax (BAT)?
Border adjustment tax (BAT) is a duty that is proposed to be imposed on imported goods in addition to the customs levy that gets charged at the port of entry. It is not charged on exports.
Various taxes such as electricity duty, mandi tax, clean energy cess and royalty imposed on domestic goods lead to escalation of price which give imported goods a price advantage in India.
