Indian Market & Trends

Travel industry wants inbound duty-free value hiked to $1000

DELHI

Kreol Travel Retail CEO AS Lal has called on Indian authorities to further raise the inbound duty free allowance for returning residents to US$1,000, following Budget changes announced earlier this month.

The duty free value allowance was raised to Rs 45,000 (US$750) from Rs 35,000 (US$585) for all passengers aged ten years or above and returning to the country after being away for more than three days. This spells positive news for offshore airport travel retailers serving India-bound passengers who buy gifts for family and friends. [More dramatically for the industry, the same Budget halved the inbound duty free tobacco allowance to 100 sticks, 25 cigars or 125 grams of tobacco – Ed]. 

But A.S. Lal – whose company operates duty free at Cochin Airport in a joint venture with World Duty Free Group – has said that even the higher allowance limits restrict passengers’ ability to shop in Indian arrivals. He said: “I believe that US$1,000 should be the duty free allowance for arriving passengers. Right now, due to the limited allowance, inbound passengers buy products in departing countries and India loses out on market share. 

“If the customer wants to purchase more than the allowed amount, we have to inform the customs department. The ensuing complicated documentation irritates customers to the point that they often get aggressive with shop staff because departing airports did not ask them these questions nor place any restrictions on quantities purchased.”

Read the full report at Moodiereport 

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