Chinese ecommerce platforms have so far been shipping goods to Indian consumers by marking them as ‘gifts’, to exempt them from customs duty under the current rules which applies to gifts valued under Rs. 5,000.
This is all set to change as the government is planning to introduce taxes and customs duties which may total to as much as 50% of the value of the consignments. A mix of integrated goods and services tax and customs duty will be applied to buyers at payment stage is what is being reported in some sections of the media.
The customs department has been looking to crackdown on this practice of marking low value shipments as ‘gifts’ and it appears that this time they mean business. Many Indian ecommerce players such as Shein depend upon Chinese suppliers and this may affect their business model drastically.