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MAIT welcomes budget 2011

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DQW Bureau
New Update





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style="font-size: 13pt;" size="3">The

Honorable Union Finance Minister has presented an inclusive budget

for the 'aam aadmi' and made simple corrections for building the

industrial impetus for the nation. By defining a clear roadmap for

the DTC and GST, the FM has set the stage for delivering a power

fiscal ecosystem where the cascaded taxes are progressively ended,

business is made simple for business and the industry is made

competitive. It is heartening that the Hon'ble Finance Minister has

recognized the strong potential of IT to reboot key national

projects.

style="font-size: 13pt;" size="3">The

UIDAI implementation; National Knowledge Network and projects like

Central Electronic Registry will improve the system efficiency as

well as boost demand for IT in the country. Broadband connectivity to

2.5 lakh panchayats in three years will have a major e-inclusion

impact on the rural India.

style="font-size: 13pt;" size="3">The

increase of Minimum Alternate tax (18.5 percent from 18 percent) and

the reduction of the surcharge for domestic companies(5 percent from

7.5 percent) are a typical FM trick (give with one hand and take

with another), no surprise there; and that is the best thing about

the budget.



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style="font-size: 13pt;" size="3">Some

of the other noteworthy outcomes of the Union Budget 2011-12 are:

style="font-size: 13pt;" size="3">* No change in peak customs duty rate

style="font-size: 13pt;" size="3">* Cut in import duties of raw

material and full exemption from SAD

for mobile phones to boost cellphone industry

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style="font-size: 13pt;" size="3">* Central excise duty rate unchanged

at 10 percent

style="font-size: 13pt;" size="3">* Rate of service tax continues at

10 percent

style="font-size: 13pt;" size="3">* Clarification on the IT Software

for non-rsp'able software

imports

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style="font-size: 13pt;" size="3">* New scheme to be introduced for

refund of service tax on lines of

drawback of duties.

style="font-size: 13pt;" size="3">* Concessional import duty structure

of five percent CVD and nil

SAD on prescribed parts for manufacture of DVD writers , combo drives

and CD drives subject to actual user option will drive the

manufacturing options but an increase in excise duty to five percent

for microprocessors, DVD writers, CD writers, Floppy Disk Drives,

Flash drives will increase the PC rates for the consumer.

style="font-size: 13pt;" size="3">On

the flip side — it is extremely disappointing that the bulk of the

electronics manufacturing sector will continue to see an exposure to

SAD - a controversial four percent duty that promotes imports at the

cost of manufacture. By missing on a long-standing demand of the

industry — another year is lost for a breakthrough in India

manufacturing.

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