Wednesday, March 4, 2015

India - Union Budget 2015-16 - Budget aims to boost domestic manufacturing with duty cuts in raw materials - Corrosion of steel is overlooked when depreciation rate and tariff or customs duty are taken for financial calculation

Tariff rate is increased on iron & steel and articles of iron or steel. To promote domestic manufacturing and ‘Make in India’ for creation of more jobs, finance minister Arun Jaitley has announced a series of cuts in customs and excise duties in the budget 2015-16.


Budget plans to give a boost for job creation through revival of growth and investment and promotion of domestic manufacturing. To promote domestic manufacturing and ‘Make in India’ for creation of more jobs, finance minister Arun Jaitley has announced a series of cuts in customs and excise duties in the budget 2015-16.

Customs duties on certain inputs like metal parts, insulated wires and cables, refrigerators compressor parts, compounds used in catalytic converters, sulphuric acid for use in manufacture of fertilisers and compounds of video cameras have been reduced.

Similarly, basic customs duty is being reduced on certain raw materials used in lathe machines from 7.5% to 2.5%, medical video endoscopes from 5% to 2.5 %, telecommunication grade optical fibre cables from 7.5% to Nil and LCD/LED TV panels from 10% to Nil. CVD and SAD are being fully exempted on specified raw materials for use in the manufacture of pacemakers.

SAD is reduced in metal scrap of iron & steel, copper, brass and aluminium from 4% to 2% to address problem of CENVAT credit accumulation. For inputs used for manufacturing of LED driver and MCPCB for LED lights, fixture and LED lamps, SAD has been reduced from 4% to nil.

Basic customs duty is increased for metallurgical coke. Tariff rate is increased on iron & steel and articles of iron or steel. Tariff rate on commercial vehicles is increased from 10% to 40% and effective rate from 10% to 20%.

Excise duty is restructured on certain goods such as wafers for use in the manufacture of integrated circuit (IC) modules for smart cards from 12% to 6%, inputs for use in the manufacture of LED lamps from 12% to 6%, specified raw materials for use in the manufacture of pacemakers to nil, solar water heater and system from 12.5% to nil and tablet computers from 12% to 2%.

Article Source: http://www.business-standard.com/content/b2b-manufacturing-industry/budget-aims-to-boost-domestic-manufacturing-with-duty-cuts-in-raw-materials-115022800765_1.html
Publication Date: 28 February 2015

1 comment:

  1. Tariff increase for Iron and Steel may encourage the domestic manufacturers to produce more indigenous items. Performance of steel is the key question for consumers. Cheaper rate offered in the domestic market poses greater challenge for the quality and performance of steel. Corrosion of steel is overlooked when depreciation rate and tariff or customs duty are taken for financial calculation. There is no credit scheme available for corrosion control in our taxation to encourage the material conservation efforts and extend the life of steel components.

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