The reaction over budget 2010 is on air now. The Finance Minister has failed to cheer assessee of Indirect Taxes. Even the matter for implementation of the proposed GST has been deferred for one more year. The Finance Minister addressed to certain services to be brought within the purview the Service Tax Levy, which are to be notified separately. The government decided to retake the same 10 % rate of Service Tax but raised 2 % Excise Duties from the current 8 percent.
In presented budget, the government has more emphasized on Infrastructure projects and Green Revolution including betterment & additional expenditures on rural development areas. Akin treatment of the government would have been seen for matters of Indirect Taxation too.
Somewhat the praiseworthy logic of the government to raise excise duties on tobacco products may discourage the toxic trade. Some structural changes have been introduced in the excise duty on cigarettes, cigars and cigarillos to be made coupled with some increase in rates. Excise duty on all non-smoking tobacco such as scented tobacco, snuff, chewing tobacco etc to be enhanced. Compounded levy scheme for chewing tobacco and branded unmanufactured tobacco based on the capacity of pouch packing machines are to be introduced.
Now you will pay more for your vehicles. Not only Diesel/ Petrol prices have been moved up but also retail prices of your two and four wheelers will be hiked. Excise duty on large cars, multi-utility vehicles and sports-utility vehicles increased by 2 percentage points to 22 per cent. The Government has also enhanced Central Excise duty on petrol and diesel by Re.1 per litre each.
The pre-proposed Goods and Service Tax (GST) is again an issue for ongoing discussions and will be at attempts with Direct Tax Code from April 1, 2011. The government aims to expand the revenue of Service Tax Sector, thus bringing other non-taxed services to put in the taxable category. The government will also continue the 10 % rate of tax on services. Exemption from Service Tax has been provided to some qualified news agencies which provide news feed online that meet certain criteria.