India Extends Excise Duty Cuts on Vehicles and Capital Goods
DELHI – India’s Ministry of Finance (MoF) has officially extended existing duty concessions on several items including vehicles, capital goods and consumer durables to December 31, 2014.
Officially announced in Notification No. 06/2014-Central Excise (dated June 25, 2014), the notification extends duty concessions outlined in Notification No. 12/2012-Central Excise (dated March 17, 2012 and amended via Notification No. 04/2014-Central Excise) for an additional six months.
Key changes in excise duty that will now be extended from Notification No. 12/2012 include:
- Excise duty on vehicles is reduced as follows:
The excise duty on chassis has also been reduced along with the duty on hybrid and hydrogen vehicles. These changes will be valid until June 30, 2014.
- Excise on machinery and equipment falling under Chapters 84 and 85 of the Central Excise Tariff is reduced from 12 to 10 percent. This includes washing machines, air conditioners, refrigerators, computers, color televisions, etc. and related components. These changes will also be valid until June 30, 2014.
- Excise duty on domestic mobile handsets is reduced to between one and six percent, and excise duty on imports is six percent countervailing duty (CVD) in an attempt to spur domestic manufacturing. Mobile handsets will attract one percent excise duty if Central Value Added Tax (CENVAT) benefits are not availed of and six percent if CENVAT is. All imported mobile handsets will now attract six percent CVD.
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