Indirect Tax Highlights in the Budget:
Remove seven tariff rates. This is over and above the seven tariff rates removed in 2023-24 budget. After this, there will be only eight remaining tariff rates including ‘zero’ rate.
Apply appropriate cess to broadly maintain effective duty incidence except on a few items, where such incidence will reduce marginally.
Levy not more than one cess or surcharge. Therefore Social Welfare Surcharge on 82 tariff lines that are subject to a cess, exempted.
Revenue of about ₹ 2600 crore in indirect taxes will be forgone.
Relief on import of Drugs/Medicines
36 lifesaving drugs and medicines fully exempted from Basic Customs Duty (BCD).
6 lifesaving medicines to attract concessional customs duty of 5%.
Specified drugs and medicines under Patient Assistance Programmes run by pharmaceutical companies fully exempted from BCD; 37 more medicines added along with 13 new patient assistance programmes.
Support to Domestic Manufacturing and Value addition
Critical Minerals :
Cobalt powder and waste, the scrap of lithium-ion battery, Lead, Zinc and 12 more critical minerals fully exempted from BCD.
Textiles:
Two more types of shuttle-less looms fully exempted textile machinery.
BCD rate on knitted fabrics revised from “10% or 20%” to “20% or ` 115 per kg, whichever is higher.
Electronic Goods:
BCD on Interactive Flat Panel Display (IFPD) increased from 10% to 20% .
BCD reduced to 5% on Open Cell and other components.
BCD on parts of Open Cells exempted.
Lithium Ion Battery:
35 additional capital goods for EV battery manufacturing, and 28 additional capital goods for mobile phone battery manufacturing exempted.
Shipping Sector:
Exemption of BCD on raw materials, components, consumables or parts for the manufacture of ships extended for another ten years.
The same dispensation to continue for ship breaking.
Telecommunication:
BCD reduced from 20% to 10% on Carrier Grade ethernet switches.
Export Promotion
Handicraft Goods:
Time period for export extended from six months to one year, further extendable by another three months, if required.
Nine items added to list of duty-free inputs.
Leather sector:
BCD on Wet Blue leather fully exempted.
Crust leather exempted from 20% export duty.
Marine products:
BCD reduced from 30% to 5% on Frozen Fish Paste (Surimi) for manufacture and export of its analogue products.
BCD reduced from 15% to 5% on fish hydrolysate for manufacture of fish and shrimp feeds.
Domestic MROs for Railway Goods:
Railways MROs to benefit similar to the aircraft and ships MROs in terms of import of repair items.
Time limit extended for export of such items from 6 months to one year and made further extendable by one year.
Trade facilitation
Time limit for Provisional Assessment:
For finalising the provisional assessment, time-limit of two years fixed, extendable by a year.
Voluntary Compliance:
A new provision introduced to enable importers or exporters, after clearance of goods, to voluntarily declare material facts and pay duty with interest but without penalty.
Extended Time for End Use:
Time limit for the end-use of imported inputs in the relevant rules extended from six months to one year.
Such importers to file only quarterly statements instead of a monthly statement.