In a Gazette Notification dated 1st February, 2020, the Finance Bill, 2020 (“Bill”) has been issued in order to give effect to the financial proposals of the Central Government for the financial year 2020-2021.
The Bill proposes to impose health cess on specific imported medical devices.
It proposes that certain amount of health cess will be charged when specific goods, mentioned in the *Fourth Schedule to the Bill, are imported to India. The Cess will be charged for the purposes of financing the health infrastructure and services.
For calculating the **Health Cess under the provisions of the Bill, it is proposed that when the duty will be leviable on the value of the goods, the said value of the goods will be calculated in the same manner as the value is calculated for the purpose of customs duty under the provisions of ***Section 14 of the Customs Act, 1962.
Please note that the Health Cess leviable will be in addition to any other duties of customs chargeable on such goods under the Customs Act or any other law for the time being in force.
The provisions of the Customs Act, 1962 and the Rules and Regulations, including those relating to refunds and exemptions from duties, offences and imposition of penalty, will be applicable in relation to the levy and collection of the Health Cess under the provisions of the Bill with respect to the goods specified in the Fourth Schedule.
*All goods falling under headings 9018, 9019, 9020, 9021 and 9022 of the First Schedule to the Customs Tariff Act, 1975 (Page no. 822-826) are covered by the Fourth Schedule. For all the goods covered by the Fourth Schedule, the rate of duty will be 5%.
**Health Care Cess: Section 139 of the Finance Bill, 2020.
***Section 14 of the Customs Act, 1962 deals with Valuation of Goods.
Source: Lok Sabha (Page 43)