What is Indirect Tax In India 2021-22 budget

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  • Custom Duty Rationalization:
    • Twin objectives: Promoting domestic manufacturing and helping India get onto global value chain and export better.
    • 80 outdated exemptions already eliminated and further review of more than 400 old exemptions.
    • New customs duty exemptions to have validity up to the 31st March following two years from its issue date.
  • Electronic and Mobile Phone Industry:
    • For greater domestic value addition: Some exemptions on parts of chargers and sub-parts of mobiles withdrawn.
  • Reduction in Custom Duty: On certain Iron and steel products, Textile products, Gold and Silver, Chemicals etc.
  • Renewable Energy:
    • To build domestic capacity: Phased manufacturing plan for solar cells and solar panels to be notified and Duty on solar invertors raised.
  • MSME Products:
    • Exemption on import of duty-free items rationalized to incentivize exporters of garments, leather, and handicraft items.
    • Exemption on imports of certain kind of leathers withdrawn.
    • Customs duty on finished synthetic gem stones raised to encourage domestic processing.
  • Agriculture Products:
    • Customs duty on cotton increased from nil to 10% and on raw silk and silk yarn from 10% to 15%.
    • Agriculture Infrastructure and Development Cess (AIDC) on curtain items including petrol, diesel, gold etc. in an attempt to boost agriculture infrastructure.
      • AIDC of Rs 2.5 per litre has been imposed on petrol and Rs 4 per litre on diesel.
  • Rationalization of Procedures and Easing of Compliance:
    • Turant Customs initiative, a Faceless, Paperless, and Contactless Customs measures
    • New procedure for administration of Rules of Origin.


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