The Central Board of Indirect Taxes and Customs (CBIC) has merged 31 separate customs duty exemption notifications, issued between 1957 and 2025, into one simplified notification. This change is outlined in Notification No. 45/2025-Customs, dated October 24, 2025, and will be effective from November 1, 2025. This move aims to make India’s trade rules easier to understand, improve transparency, and help importers, exporters, and customs officers work more efficiently.
Background and Rationale
Earlier, businesses and customs officials had to go through many different notifications to figure out which duty rates and exemptions applied. This made the process confusing and time-consuming.
The new consolidated notification solves this problem. It supports the government’s “Next Generation Customs Reforms” and is part of a broader effort led by the Department for Promotion of Industry and Internal Trade (DPIIT). These reforms focus on:
- Making rules simpler
- Reducing paperwork
- Using digital systems
- Removing unnecessary legal hurdles
Key Changes and Impact
- Single Reference Document: Notification No. 45/2025-Customs replaces Notification No. 50/2017-Customs and 30 other exemption notifications. From November 1, 2025, businesses only need to refer to this one document for customs duty exemptions.
- No Loss of Benefits: CBIC has confirmed that all existing exemptions and benefits will continue under the new notification. This ensures a smooth transition without affecting business operations.
- Better Clarity and Consistency: By combining multiple notifications into one, CBIC has made customs rules easier to follow. This change is expected to reduce confusion and help ensure consistent application across ports.
Minor Modifications
Some small but important updates have been made:
i) Aviation Sector: The duty exemption for warehoused goods supplied to Air India International has been updated. It now includes Air India Engineering Services Limited (AIESL) and covers three Boeing 737 and two Boeing 777 aircraft operated by the Indian Air Force.
ii) Pharmaceutical Sector: A duplicate 5 percent Basic Customs Duty (BCD) on bulk drugs used for making Poliomyelitis Vaccine and Mono-component Insulins has been removed. These drugs will continue to attract zero duty under the new notification.
Alignment with Other Tax Notifications
To keep things consistent across the tax system, CBIC has also updated related notifications. These include:
- Health Cess
- Social Welfare Surcharge (SWS)
- Agriculture Infrastructure Development Cess (AIDC)
These changes are part of Notification No. 44/2025-Customs. Updates have also been made under the GST regime to match the new customs notification.
Validity and Continuity
CBIC has clarified that the validity of exemptions and concessions remains unchanged. All conditional exemptions and reduced duty benefits will continue under Section 25(4A) of the Customs Act, 1962, unless future notifications say otherwise.
Support for Stakeholders
To help businesses adjust smoothly, CBIC has released a detailed FAQs document. It explains:
- Why the reform was needed
- What changes have been made
- How existing exemptions are preserved
These FAQs are useful for importers, exporters, and customs brokers who want to understand the new rules.
Broader Implications
This reform is a major step in modernizing India’s customs system. It supports:
- Easier tariff classification
- Uniform interpretation across ports
- Better trade facilitation globally
Experts have welcomed the move for making regulations simpler and more transparent. Notification No. 18/2025-Central Tax (Rate) also updates the definition of “nominated agency” to include Yes Bank, Indian Overseas Bank, and Union Bank of India. These agencies can now handle duty-free imports of gold, silver, and platinum.
CBIC Customs Notification 45/2025 dated 24/10/2025: Seeks to supersede 31 customs exemption notifications and prescribes effective rates of customs duty, IGST and compensation cess for goods imported into India
Note: This information is based on official announcements available as of October 27, 2025. For the latest updates, please refer to CBIC’s official website or publications.
Frequently Asked Questions
1. Is Notification No. 45/2025-Customs dated 24 October 2025 a new notification?
Yes, this is a new notification. It combines the earlier Notification No. 50/2017-Customs dated 30 June 2017 and 30 other standalone Customs notifications. You can find the full list of these 30 notifications in the Annexure.
2. What does Notification No. 44/2025-Customs dated 24 October 2025 include?
This notification updates references in several older notifications. These include:
- Notification No. 8/2020-Customs (Health Cess)
- Notification No. 11/2018-Customs (Social Welfare Surcharge)
- Notification No. 11/2021-Customs (Agriculture Infrastructure Development Cess)
- Notification No. 52/2017-Customs (Chapter 27 goods)
The updates replace old references with new ones from Notification No. 45/2025-Customs.
3. What changes were made in Notification Nos. 18/2025 (Central, UT, and Integrated Tax Rate)?
These notifications update older GST-related notifications dated 31 December 2018. The key change is the replacement of List 34 (linked to S. No. 359A of Notification No. 50/2017-Customs) with new Lists 13, 14, and 15 under S. No. 198 of Notification No. 45/2025-Customs. This ensures that IGST exemptions continue for specified banks and entities.
4. When do these notifications come into effect?
All the notifications dated 24 October 2025, including:
- Notification Nos. 44/2025 and 45/2025-Customs
- Notification Nos. 18/2025 (Central, UT, and Integrated Tax Rate)
will be effective from 1 November 2025.
5. Why was Notification No. 45/2025-Customs issued?
This is a trade-friendly move. It merges 31 separate notifications into one, making it easier to refer to exemptions and concessional rates. This helps reduce confusion and improves compliance.
6. Are the existing exemptions from Notification No. 50/2017-Customs and others still valid?
Yes, all exemptions and concessional rates from Notification No. 50/2017-Customs and the 30 other notifications listed in the Annexure are continued, with two small changes:
- Change 1: S. No. 5 of Notification No. 39/96-Customs now includes duty exemption for supplies by Air India Engineering Services Limited (AIESL). It covers three B-737 and two B-777 aircraft operated by the Indian Air Force.
- Change 2: S. No. 166A of Notification No. 50/2017-Customs, which allowed 5% duty on bulk drugs for Poliomyelitis Vaccine and Mono component Insulins, has been removed. These drugs now attract nil duty under S. No. 103(ii) of Notification No. 45/2025-Customs.
7. Why was S. No. 5 of Notification No. 39/96-Customs changed?
Earlier, this entry gave exemption to supplies from warehoused goods of Air India International for two B-737 aircraft used by the Indian Air Force. Now, it includes supplies by AIESL and covers five aircraft in total (three B-737 and two B-777).
8. Why was the 5% duty on bulk drugs removed?
There were two entries for these drugs, one with 5% duty and another with nil duty. Since nil duty was already available under S. No. 167(D) of Notification No. 50/2017-Customs, the 5% entry was removed. Under the new notification, these drugs continue to attract nil duty under S. No. 103(ii).
9. Has the validity of exemptions changed?
No, the validity remains the same. Unless stated otherwise, exemptions will expire as per Section 25(4A) of the Customs Act.