Mobile phones that cost more than Rs. 2,000, tobacco products including cigarettes and cheroots, sports utility vehicles (SUVs), marble, silver products… the list of products that become dearer in the wake of finance minister P Chidambaram’s budget proposals is long, but not as long as it could
The only silver lining for the consumer and for industry is branded apparel, which will become cheaper as there will be zero excise duty.
Carpets and other textile floor coverings of coir or jute will also become less expensive, as they have been fully exempted from excise duty.
Walking the tightrope ahead of next year's elections, the finance minister refrained from making major changes in the standard rate of excise duty as it could have stoked inflationary pressures further.
However, he increased specific excise duty on mobile phones, tobacco products, sports utility vehicles (SUVs) and marble, pushing up their prices. The move is expected to push up revenue receipt by over Rs. 25,500 crore in 2013-14, to Rs. 1.98 lakh crore.
At the same time, Chidamabarm announced major excise duty benefits for the textiles industry by accepting the demand for "a zero excise duty route" for cotton and manmade fabrics sector at the yarn, fabric and garment stages.
Standard excise duty on tobacco products have been raised by about 18% and on mobile phones priced at more than Rs. 2,000 to 6% from 1%. Phones priced below Rs. 2,000 will continue to enjoy a concessional 1% excise duty.
The excise duty rate on marble has been increased from Rs. 30 per square meter to Rs. 60, and an excise duty of 4% has been levied on silver manufactured from smelting zinc and lead, bringing it on par with silver obtained from copper ores and concentrates.