|
Government has been pursuing the objective of moderately progressive tax structure by reduction in general levels of customs tariffs, reduction in the dispersion of tariff rates and rationalization of duty structure and rates. The changes are made in a gradual way so as to moderate their impact on both domestic industry and revenue.
In Budget 2005, the government has brought down peak rate of customs duty (for non agriculture goods with a few exceptions) from 20% to 15%. Customs duty on basic raw materials including metals, refractory raw materials, catalysts, basic organic chemicals and basic plastic materials has been reduced to 10%, on crude petroleum to 5% and on petroleum products to 10%. Customs duty on a number of capital goods has also been reduced to 10% or 5%. Further, excise duty has been reduced from 24% to 16% on tyres, air conditioners and polyester filament yarn.
Changes made in duty structure and rates are expected to reduce cost of raw materials as well as capital goods and thus facilitate investment and growth. Actual growth, however, depends upon a number of factors, including the tax structure and rates.
This information was given by Shri S.S. Palanimanickam, Minister of State for Finance in reply to a question raised by Prof. Mahadeorao Shiwankar in Lok Sabha today.
BSC/BY/DN-161/05
|
