o
Fresh Coffee Debt Relief Package, specifically for the small growers. As per this,
for pre-2002 loans, 50 per cent of the total liability shall be waived subject
to a maximum benefit of Rs.5 lakh per farmer to be borne by Government of India
Direct Taxes o Considering the pressing need for more hospitals all over
the country, it is proposed to include the business of a new hospital anywhere
in India, with at least one hundred beds for patients, as a 'specific business'
for availing the benefit of investment linked deduction. o Business of developing
and building a housing project under a scheme for slum redevelopment or rehabilitation
framed by the Central Government or a State Government to be included as a 'specified
business' for availing the benefit of investment linked deduction. o In consequence
of the decision to allow tax-neutrality for conversion of a company in to Limited
Liability partnership (LLP), it is proposed to also exempt from taxation the transfer
of shares by the shareholders of the company in respect of such a conversion.
Service Tax o Air Travel not to be prohibitive - Service tax maximum of
Rs.100 per travel for domestic journey and Rs.500 per travel for international
journey by economy class o Abatement of 75% for construction service. Procedural
bottlenecks relating to the completion certificate prescribed in the law would
also be simplified. o With a view to give thrust to the low cost housing schemes
for the urban poor, service tax on constructions under Jawaharlal Nehru National
Urban Renewal Mission (JNNURM) and under Rajiv Awas Yojna, to be exempted o
Exemption available to the vocational training institutes affiliated to the National
Council for Vocational Training and offering courses in designated trades should
also be extended to "Modular Employment Skill Development courses" provided
by the training institutes registered under 'Skill Development Initiative Scheme'
of the Ministry of Labour. Indirect Taxes o Reduced excise duty on hand-rolled
cheroots priced upto Rs.3 per stick to 10% ad valorem. Similarly, the additional
excise duty on this product shall now be 1.6% ad valorem. o Full exemption
from excise duty has been provided to betel nut product commonly known as 'supari'.
This exemption is now being extended to scented supari. o Central excise duty
on corrugated boxes and cartons was reduced from 8% to 4% when they are manufactured
starting from kraft paper. Proposed to extend the exemption to cover units that
manufacture such cartons from corrugated paper or paperboard also. o Paper
and paperboard manufactured from non-conventional raw material such as waste paper
attract a concessional excise duty of 4% subject to certain conditions. Waste
paper is chargeable to an excise duty of CVD of 10%. Domestic industry has represented
that this creates an inversion leading to the accumulation of Cenvat credit. The
excise duty on waste paper reduced to 4% to rectify this anomaly. o The excise
exemption for small scale units is not available to goods that bear the brand
name of another person. A relaxation of this condition is available in respect
of specified packing materials which are normally not sold under the brand name
that they bear. In order to resolve disputes about the coverage of this relaxation,
this is extended to all types of packing material. o Automobile components
have been subjected to excise duty on the basis of their retail sale price. In
order to resolve disputes about the coverage of this provision, it was amended
so as to make it applicable to parts, components and assemblies of vehicles of
Chapter 87 of the Excise Tariff. Since these components are also used for earthmoving
machinery like loaders, excavators etc., this will now apply to the parts, components
and assemblies of such machinery as well. o Tunnel boring machines are critical
for hydroelectric projects. Since these are not produced domestically, full exemption
from customs duty was provided in this budget. It has been represented that owing
to their huge size these machines are incapable of import in a single consignment.
Considering this practical difficulty the exemption is being extended to parts
and components of tunnel boring machines. o Concessional customs duty for
Ostomy appliances as these are mainly used by cancer patients. o Basic customs
duty on 11 specified drugs including two anti-cancer and one for the treatment
of AIDS is being reduced to 5%. These drugs are also being exempted from CVD by
way of excise duty exemption. o 'Optical Disc Drives' (ODD) are ITA-bound
and thus permissible for import without payment of duty. Specified parts or components
required for the manufacture of ODD exempted from basic customs duty. o Cigarette
filter rods are manufactured from acetate rayon tow. While full CVD of 10% and
special CVD of 4% is applicable to tow, the excise duty on filter rods is 10%
creating an inversion in duty. Acetate rayon tow exempted from special CVD of
4%. o Flax fibre and yarn are not produced in India in significant quantities.
They are fully exempted from basic customs duty in order to encourage domestic
value addition. o Export duty at the statutory rate of Rs.2500 per metric
tonne (PMT) was imposed on raw cotton with effect from 9 th April, 2010 in order
to contain the spiraling prices by disincentivizing exports. The Government has
been keenly watching the quantum of exports well as the price situation. In order
to meet any future exigency, the statutory rate for this item is being enhanced
to Rs.10, 000 PMT while maintaining the effective rate at the current level. Except
in the case of export duty on raw cotton, the changes in the customs and excise
duties would come into force with immediate effect. In December 2009 the
export duty on iron ore lumps was enhanced from 5% to 10% and on fines from Nil
to 5%. Keeping in view the trend in the quantum of exports and domestic and international
prices, the duty on iron ore lumps is being increased further to 15%. In response
to representations from the domestic producers of stainless steel, basic customs
duty on stainless steel melting scrap reduced from 5% to 2.5%
