Finance Minister P Chidambaram has indicated that the government might make minor adjustments in excise duties and service tax rates in the vote-on-account (interim budget) to be presented in Parliament on February 17. The vote-on-account is not a full-fledged Budget and no major changes by way of amendments could be made to it.
By adding further, Chidambaram added that changes required in the excise rates or service tax rates will be made without an amendment. The prevailing economic slowdown may prompt the government to experiment with indirect tax cuts in the hope that resultant savings could boost the margins of companies.
It is expected that government can cut excise and service tax rates from the current 12% to 10% proposed earlier in order to provide some impetus to industrial growth. However, during the first nine months of 2013-14, Indirect tax collection grew just 6.2% to Rs 3,55,003 crore as compared to the year earlier. The government had projected a 20% growth in indirect taxes this fiscal to Rs 5.65 lakh crore. Domestic industries also expect a five-year extension of the excise duty exemption given to the industry in states such as Himachal Pradesh and J&K that expires in May 2014.
By adding further, Chidambaram added that changes required in the excise rates or service tax rates will be made without an amendment. The prevailing economic slowdown may prompt the government to experiment with indirect tax cuts in the hope that resultant savings could boost the margins of companies.
It is expected that government can cut excise and service tax rates from the current 12% to 10% proposed earlier in order to provide some impetus to industrial growth. However, during the first nine months of 2013-14, Indirect tax collection grew just 6.2% to Rs 3,55,003 crore as compared to the year earlier. The government had projected a 20% growth in indirect taxes this fiscal to Rs 5.65 lakh crore. Domestic industries also expect a five-year extension of the excise duty exemption given to the industry in states such as Himachal Pradesh and J&K that expires in May 2014.
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