Amendments in Indirect Tax Rates as per Interim Union Budget 2014-15

The following rate changes have been proposed in indirect taxes:

• States to partner in development so as to enable the Centre to focus on Defence, Railways, National Highways and Telecommunication.
• Excise Duty on all goods falling under Chapters 84 & 85 (machinery & mechanical appliances, Electrical machinery and equipments & parts thereof, sound recorders & reproducers, television images & sound recorders and reproducers, parts & accessories of such articles etc) of the first schedule of Central Excise Tariff Act is reduced from 12% to 10% for the period upto 30.06.2014
• To give relief to the automobile industry whic is registering unprecedented negative growth, the excise duty is reduced for the period up to 30.06.2014. For Smallcars, motorcycles & Scooters - 8% (previously 12%); For commercial vehicles & SUVs - 24% (previously 30%); For Large & Mid segment cars - 24%/20% (previously 27%/24%).
• It is also proposed to make appropriate reductions in the excise duties on chassis & trailors - The rates can be reviewed at the time of regular budget.
• To encourage domestic production of mobile handsets, the excise duties for all categories of mobile handsets is restructured. The rates will be 6% with CENVAT Credit or 1% without CENVAT Credit.
• To encourage domestic production of soaps and oleo chemicals, the customs duty structure on non-edible grade industrial oils and its fractions, fatty acids and fatty alcohols is rationalised at 7.5%.
• To encourage domestic production of specified road construction machinery, the exemtion from CVD on similar imported machinery is withdrawn.
• A concessional custons duty of 5% on capital goods imported by the Bank Note Paper Mill India Pvt Ltd. is provided to encourage domestic production of security paper for printing currency notes
• The loading and unloading, packing, storage and warehousing of rice is exempted from service tax
• The services provided by cord blood banks is exempted from service tax