Budget 2026: Industry seeks amnesty in customs duty, faster trade, and fewer disputes, says PwC
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As India gears up for the Union Budget 2026, PwC said industry stakeholders are looking for continuity in customs duty reforms, with a stronger push on faster trade facilitation, fewer disputes, and better support for domestic manufacturing.
Gautam Khattar, Principal, Price Waterhouse & Co LLP, said while India has successfully implemented amnesty-style programmes for dispute resolution in other tax areas, the customs regime continues to face a substantial backlog of disputes and has never seen a comparable dispute mitigation scheme.
“A time-bound Customs Amnesty Scheme in Budget 2026 could offer a practical exit—partial waiver of disputed duty and full waiver of interest and penalties for businesses,” he said.
According to Khattar, this would enable quick settlement of legacy cases and faster revenue realisation. Furthermore, this would mirror the calibrated approach seen in Sabka Vishwas (Legacy Dispute Resolution) Scheme, 'Vivad se Vishwas', and the DGFT Amnesty Scheme.
“The result would be fewer cases in litigation, more administrative bandwidth for current matters, and greater certainty and closure for businesses,” Khattar said.
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Reforms for ease of doing business
According to industry expectations outlined by PwC, stakeholders are also seeking further tariff rationalisation to support manufacturing. This includes a proposal to reduce the number of customs duty slabs to five or six from the current eight, in order to improve clarity and simplify trade.
“This will align input and intermediate duties with finished goods rates to remove inversions and support local value addition,” Anurag Sehgal, Anurag Sehgal, Principal, Price Waterhouse & Co LLP, said.
According to Sehgal, the Union Budget should push forward on two fronts, “making compliant trade faster and simpler, and deepening end-to-end digitisation of customs processes. Building on a decade of reforms, the focus is expected to be on expanding trusted-trader benefits,” he said.
Calls for targeted cuts in duties
Experts have also called for targeted cuts in duties on raw materials and intermediate goods to address duty inversions, especially in sectors where finished products attract lower tariffs under free trade agreements.
PwC said a comprehensive review of customs exemptions is another key expectation. The industry wants exemptions to be extended only where they support priority areas such as green technology, critical inputs and strategic manufacturing, with clear sunset clauses and periodic reviews.
Reforms in Special Economic Zones
Reforms to Special Economic Zones are also being sought. PwC said industry has suggested limiting customs duty on SEZ-to-domestic sales only to the duty foregone on imported inputs, while exempting value added within the SEZ. This move is expected to boost domestic sales and improve capacity utilisation.
Overall, industry believes that a combination of dispute resolution, tariff correction, digitisation, and targeted incentives in the Union Budget 2026 can lower trade friction, improve cost competitiveness and give a fresh push to Indian manufacturing.