News APP

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  gplay

This article was first published 12 years ago
Rediff.com  » Business » Budget 2012: Dyes and pigments Industry expects reinstatement of exemption

Budget 2012: Dyes and pigments Industry expects reinstatement of exemption

March 17, 2012 17:35 IST
Get Rediff News in your Inbox:

DyesThe following changes in the duties have been proposed in the Union Budget 2012-13: Excise duty up from 10% to 12%.

Steam coal is being fully exempted from basic customs duty.

CVD is also being reduced from 5% to 1% on such coal.

This dispensation would be valid upto 31.3.2014

Basic customs duty on titanium dioxide is being reduced from 10% to 7.5%.

No change in peak customs duty

Personal income tax exemption limit for general category raised to Rs 2 lakh from Rs 1.8 lakh.

Upper limit raised from Rs 8 lakh to Rs 10 lakh for 20% bracket

Service tax rate raised from 10% to 12%

Proposal to tax all services except those in the negative list comprising of 17 heads

DTC Implementation deferred

GST to become operational by August 2012

No change in corporate tax rates

Industry expectations -- not fulfilled

The industry expects 0% duty on all types of fuels, low duty rate of 2% on basic building blocks like benzene, toluene, xylene, naphthalene etc.; moderate duty rate on Intermediates of 5% and high duty rate on finished products of 7.5%.

This will encourage our industry to export value added finished products and import only basic products of low value.

Expect clear cut guidelines be laid down to complete the procedures and formalities regarding refund of excise duty to exporters within a strict time frame including provision for payment of interest on late refunds

Industry expects reinstatement of the exemption scheme, which has provided concessional rate of 60%

of the normal rate of Central Excise Duty with Cenvat credit unto clearances of Rs. 1 crore (now withdrawn).

The slab of the first clearance value of Rs 1.00 crore may be increased to Rs 2.50 (crore).

Also, for eligibility criteria, aggregate of value of Rs.4 crore in the previous financial year should be increased to Rs 5 crore.

The industry expects corporate income tax to be reduced to max. 30% and there should be no other surcharge and cess.

Income Tax for individuals and others to be reduced to 25% max.

Budget Impact

Reduction in custom duty on titanium dioxide from 10% to 7.5% is positive for paint industry and also for dyes and pigment sector

Higher excise duty at 12% would have negative impact on dyes and pigments manufacturers, as it would make their products costlier.

Stocks to watch

Sudarshan Chemicals, Atul, Kiri Industries, Ultramarine Pigments

Outlook

Union Budget 2012-13 has a neutral impact on dyes and pigments sector with negative impact of increase in excise duty to 12% from 10% mitigated by reduction in custom duty on titanium dioxide from 10% to 7.5%.

Union Budget 2012-13: Complete coverage

Get Rediff News in your Inbox:
Powered by capitalmarket
 

Moneywiz Live!