The following are the highlights of the Union Budget proposals with regard to all indirect taxes — including service tax, custom duties, excise and all other central taxes.
Standard rate of excise duty to be raised from 10 per cent to 12 per cent, merit rate from 5 per cent to 6 per cent and the lower merit rate from 1 per cent to 2 per cent with few exemptions.
Excise duty on large cars also proposed to be enhanced.
No change proposed in the peak rate of customs duty of 10 per cent on non-agricultural goods.
Agriculture and Related Sectors
Basic customs duty reduced for certain agricultural equipment and their parts;
Full exemption from basic customs duty for import of equipment for expansion or setting up of fertiliser projects upto March 31, 2015.
Proposal for full exemption from basic customs duty and a concessional CVD of 1 per cent to steam coal till 31st March, 2014.
Full exemption from basic duty provided to certain fuels for power generation.
Full exemption from basic customs duty to coal mining project imports.
Basic custom duty proposed to be reduced for machinery and instruments needed for surveying and prospecting for minerals.
Basic custom duty proposed to be reduced for equipments required for installation of train protection and warning system and upgradation of track structure for high speed trains.
Full exemption from import duty on certain categories of specified equipment needed for road construction, tunnel boring machines and parts of their assembly.
Tax concessions proposed for parts of aircraft and testing equipment for third-party maintenance, repair and overhaul of civilian aircraft.
Relief proposed to be extended to sectors such as steel, textiles, branded ready-made garments, low-cost medical devices, labour-intensive sectors producing items of mass consumption and matches produced by semi-mechanised units.
Health and Nutrition
Proposal to extend concessional basic customs duty of 5 per cent with full exemption from excise duty/CVD to 6 specified life saving drugs/vaccines.
Basic customs duty and excise duty reduced on Soya products to address protein deficiency among women and children.
Basic customs duty and excise duty reduced on Iodine.
Basic customs duty reduced on Probiotics.
Concessions and exemptions proposed for encouraging the consumption of energy-saving devices, plant and equipment needed for solar thermal projects.
Concession from basic customs duty and special CVD being extended to certain items imported for manufacture for hybrid or electric vehicle and battery packs for such vehicles.
Proposal to increase basic customs duty on imports of gold and other precious metals.
Proposals to increase excise duty on ‘demerit’ goods such as certain cigarettes, hand-rolled bidis, pan masala, gutkha, chewing tobacco, unmanufactured tobacco and zarda scented tobacco.
Cess on crude petroleum oil produced in India revised to `4,500 per metric tonne.
Basic customs duty proposed to be enhanced for certain categories of completely built units of large cars/MUVs/SUVs.
Excise duty rationalised for packaged cement, whether manufactured by mini-cement plants or others.
Levy of excise duty of 1 per cent on branded precious metal jewellery to be extended to include unbranded jewellery. Operations simplified and measures taken to minimise impact on small artisans and goldsmiths.
Branded Silver jewellery exempted from excise duty.
Chassis for building of commercial vehicle bodies to be charged excise duty at an ad valorem rate instead of mixed rate.
Import of foreign-going vessels to be exempted from CVD of 5 per cent retrospectively.
Duty-free allowances increased for eligible passengers and for children of upto 10 years.
Proposals relating to Customs and Central excise to result in net revenue gain of `27,280 crore.
Indirect taxes estimated to result in net revenue gain of `45,940 crore.
Proposal to tax all services except those in the negative list comprising of 17 heads.
Service tax law to be shorter by nearly 40 per cent.
Number of alignment made to harmonise Central Excise and Service Tax. A common simplified registration form and a common return comprising of one page are steps in this direction.
Revision Application Authority and Settlement Commission being introduced in Service Tax for dispute resolution.
Utilization of input tax credit permitted in number of services to reduce cascading of taxes.
Place of Supply Rules for determining the location of service to be put in public domain for stakeholders’ comments.
Study team to examine the possibility of common tax code for Central Excise and Service Tax.
New scheme announced for simplification of refunds.
Rules pertaining to point of taxation are being rationalised.
To maintain a healthy fiscal situation proposal to raise service tax rate from 10 per cent to 12 per cent, with corresponding changes in rates for individual services.
Proposals from service tax expected to yield additional revenue of `18,660 crore.