Indirect Tax Amendments.

IMPORTANT INDIRECT TAX AMENDMENTS BY FINANCE BILL 2013

CUSTOMS

1.       Period of concession available for specific parts of electric and hybrid vehicles extended up to 31-3-2015

2.       The duty on specified machinery used for manufacture of leather and leather goods reduced from 7.5% to 5%

3.       The duty on pre-forms of precious and semi-precious stones reduced from 10% to 2%.

4.       Export duty on de-oiled rice bran oil cake is withdrawn.

5.       Export duty is imposed on ilmenite @ 10% on unprocessed ilmenite & 5% on upgraded ilmenite.

6.       Duty on set top boxes increased from 5% to 10%.

7.       Duty on raw silk increased from 5% to 15%.

8.       Duty on steam coal and bituminous coal equalised at 2% customs duty & 2% CVD.

9.       Import duty on motor vehicles increased from 75% to 100%, that on motorcycles above 800cc or more from 60% to 75% and on yachts & similar vessels from 10% to 25%.

10.   Duty free limit for jewellery increased to Rs 50000 per male and Rs 100000 per female passenger.

EXCISE

1.       ‘Zero excise duty route’ for cotton and manmade sector(spun yarn) at the yarn, fabric and garment stages proposed. ie. For cotton, zero duty at fibre stage also and for spun yarn 12% at fibre stage.

2.       Handmade carpets and textile floor coverings of coir and jute totally exempt.

3.       Ships and vessels exempt from excise duty, consequently no CVD

4.       Specific excise duty on cigarettes, cigars, cheroots and cigarillos increased by about 18%.

5.       Excise duty on SUVs increased from 27% to 30%. The provision is not applicable to taxis.

6.       Excise duty on marble increased from Rs.30/sq.m to Rs.60/sq.m .

7.       Excise duty on silver manufactured by smelting zinc or lead increased to 4%.

8.       For mobile phones priced above Rs.2000, excise duty increased to 6%.

9.       An MRP based assessment on branded medicaments of Ayurveda, Siddha, Unani, and  Homeopathy introduced. Abatement @ 35% will be available.

SERVICE TAX

1.       Two services included in the negative list, First, Vocational courses offered by institutions affiliated to state council of vocational training and the second, training and testing activities in relation to agriculture and agricultural produce.

2.       Exemption of service tax granted on copyright on cinematography now limited to films exhibited in cinema halls.

3.       Service tax imposed on all A/C Restaurants.

4.       Abatement on high end constructions or flats with carpet area of more than 2000 sq.ft or value of more than Rs.1 crore is reduced from 75% to 70%. Other exemptions and provisions remain unaltered.

5.       A voluntary compliance encouragement scheme introduced. Details of which are available in Chapter VI of The Finance Bill, 2013.