23 C
Agartala
Tuesday, February 11, 2025

Budget focusses rationalisation of customs tariffs; relief for cancer patients

Date:

) With a view to boosting domestic manufacturing, the Government on Saturday proposed changes in the customs duties focussing on rationalizing tariff structure and addressing duty inversion, saying the proposals will support domestic manufacturing and value addition while promoting exports, facilitating trade and providing relief to common people.

Delivering on the promise to review customs rate structure announced in July 2024, the Union Budget for the year 2025-26, presented by Finance Minister Nirmala Sitharaman, proposed to remove seven customs tariff rates for industrial goods over and above the seven tariff rates removed in Budget 2023-24. This will leave only eight tariff rates, including ‘zero’ rate. The Budget also proposes to levy not more than one cess or surcharge. This will exempt Social Welfare Surcharge on 82 tariff lines that are subject to a cess.

In sector specific proposals, the Budget comes as a big relief to patients, particularly to those suffering from cancer, rare diseases and other severe chronic diseases. The Budget proposes to add 36 life-saving drugs and medicines to the list of medicines fully exempted from Basic Customs Duty. The Budget also proposes to add 6 life-saving medicines to the list attracting concessional customs duty of 5 per cent. Full exemption and concessional duty will also respectively apply on the bulk drugs for manufacture of the above.

Specified drugs and medicines under Patient Assistance Programmes run by pharmaceutical companies are fully exempt from Basic Customs Duty, provided the medicines are supplied free of cost to patients. The Budget proposes to add 37 more medicines along with 13 new patient assistance programmes to the list.

The Budget proposes to add 35 additional capital goods for EV battery manufacturing, and 28 additional capital goods for mobile phone battery manufacturing to the list of exempted capital goods. “This will boost domestic manufacture of lithium-ion battery, both for mobile phones and electric vehicles”, Finance Minister stated in her speech.

The Budget also proposes to fully exempt Basic Customs Duty on cobalt powder and waste, the scrap of lithium-ion battery, Lead, Zinc and 12 more critical minerals. Finance Minister said that this will help secure their availability for manufacturing in India and promote more jobs for our youth. This is in addition to the 25 critical minerals fully exempted of BCD in July 2024 Budget.

To promote domestic production of technical textile products such as agro-textiles, medical textiles and geo textiles at competitive prices, the Budget proposes to add two more types of shuttle-less looms to the list of fully exempted textile machinery. “I also propose to revise the BCD rate on knitted fabrics covered by nine tariff lines from “10 per cent or 20 per cent” to “20 per cent or Rs 115 per kg, whichever is higher”, Sitaraman said.

The Budget also contains certain tax proposals to promote exports. To facilitate exports of handicrafts, it proposes to extend the time period for export from six months to one year, further extendable by another three months, if required. The Budget also proposes to add nine handicraft items to the list of duty-free inputs.

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