Budget 2019: Finance Minister Changes Customs Duty Rates To Boost Make In India
Finance Minister Nirmala Sitharaman changed customs duty on a host of items to boost Make in India.
The government aims to reduce import dependence, protect small businesses and curb non-essential imports, according to the budget document.
Increase In Customs Duty
To boost local manufacturing, the Budget 2019 increased customs duty on:
- Cashew kernels, PVC, vinyl flooring, tiles, metal fittings, mountings for furniture, auto parts, certain kinds of synthetic rubber, marble slabs, optical fibre cable, CCTV cameras, IP camera, digital and network video recorders.
Withdrawal Of Benefits, Exemptions
Existing exemptions from custom duty on certain electronic items were withdrawn to encourage local manufacturing. These include:
- Palm stearin, fatty oil and certain type of papers have been withdrawn.
- To encourage domestic publishing and printing industry, 5 percent customs duty has been be imposed on imported books.
Reduction In Customs Duty
Budget 2019 cut customs duty on certain parts of electronic vehicles to boost local manufacturing, and also exempted capital goods used to make specified electronic goods.
- Customs duty lowered on CRGO sheets, amorphous alloy, ribbon, cobalt matte, naphtha, wool fibres, inputs for making artificial kidney and disposable sterilised dialyser, and fuels for nuclear power plants.
“The budget recognises the need of modernisation of India’s defence sector by providing exemption from basic customs duty for a period of five years on import of specified defense equipment,” Himanshu Relan, partner-GST at Nangia Advisors.
R Muralidharan, senior director at Deloitte India, said the exemption given to specific electronic components such as chargers, power adapters for camera, plugs and sockets, now being manufactured in India, is withdrawn to promote Make in India by disincentivising imports.