The Centre is set to introduce the Central Excise Bill, 2024, during the upcoming budget session, aiming to replace the long-standing Central Excise Act, 1944. This significant legislative update seeks to modernize the indirect tax system by eliminating outdated provisions and aligning excise law with the Goods and Services Tax (GST) and customs frameworks.
Key Highlights of the Central Excise Bill, 2024
Integration with GST and Customs
- The new bill aims to create a cohesive indirect tax system, integrating CENVAT credit provisions previously governed by separate delegated legislation.
- This alignment will streamline the tax process, making it more efficient for businesses.
Reevaluation of SEZ Exemptions
- The bill proposes a reassessment of excise duty exemptions granted to Special Economic Zones (SEZ).
- This includes introducing stricter audit processes to enhance transparency, similar to those in GST and customs practices.
Enhanced Compliance Measures
- The bill grants authorities the power to demand duty from directors of private companies and partners of partnership firms.
- It incorporates the concept of 'related persons' from customs and GST laws to ensure comprehensive coverage and compliance.
Extended Limitation Period
- The limitation period for departmental authorities to raise duty demands will be extended to three years, up from the current two-year period.
- This provides more time for thorough audits and investigations.
Improved Refund Processes
- Interest on delayed duty refunds will start accruing after 60 days from the date of the refund application, instead of the current three-month period.
- This change is expected to expedite refund processes and reduce financial strain on businesses.
Government's Stance and Expert Opinions
A senior official revealed to ET, "Our goal is to table the draft bill in the budget session." The government has invited comments and suggestions from stakeholders until June 26, ahead of the budget session expected to commence after the second week of July.
Experts believe the Central Excise Bill, 2024, could significantly reduce the compliance burden on businesses. By offering a more comprehensive legal framework, the bill is better suited to the current economic landscape. The inclusion of separate notifications for any excise duty exemptions ensures clarity and precision in tax regulations.
Overall, the proposed bill aims to create a modern, transparent, and efficient excise law system that aligns with contemporary economic and tax environments, ultimately benefiting both the government and businesses.
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