Excise duty exemptions from 130 items to be removedFebruary 28th, 2011 - 2:57 pm ICT by IANS
New Delhi, Feb 28 (IANS) The government has decided to withdraw excise duty exemptions from 130 items, mostly consumer goods, with a view to align the taxation system with the proposed goods and services tax (GST), Finance Minister Pranab Mukherjee said Monday. “I propose certain changes in the central excise structure to prepare ground for implementation of GST,” said Mukherjee while presenting the union budget for 2011-12 in the Lok Sabha.
“There are 370 items that enjoy exemptions from central excise. I propose to withdraw the exemptions from 130 of these items that are mainly in the nature of consumer goods, the remaining 240 items to be brought into the tax net when GST is introduced,” he said.
However, the finance minister said there will be no change in the standard rates of central excise duty and it would be maintained at 10 percent.
“In view of healthy growth in indirect taxes in 2010-11, I have the option to roll back central excise duty to the November 2008 level. But I have chosen not to do so for two reasons — I would like to see improved business margins translated into higher investment rates, and I would also like to stay my course towards GST,” Mukherjee said while presenting his sixth budget.
“Therefore, (I have) decided to maintain the standard rates of central excise duty of 10 percent,” he added.
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Tags: central excise duty, consumer goods, duty exemptions, finance minister, goods and services tax, implementation, indirect taxes, investment rates, Lok Sabha, margins, New Delhi, pranab mukherjee, sixth budget, tax net, taxation system, union budget