8/8/2019 PwC Budget Flash 2010 - 2011

1/11

Budget 2010 - 2011

Regulatory

Infrastructure, Urban and Rural

Development

INR 1,735,520 million outlay on infrastructure

which represents 46% of the total plan allocation

Reaffirmation of Governments commitment to

February 26, 2010

Marching Forward

Nutrient based subsidy policy for fertilizer sector

to become effective April 1, 2010 Repayment under Debt waiver and debt relief

scheme extended by 6 months to June 30, 2010

Interest subvention on crop loans increased from

1% to 2%

Banking, Capital Markets and Pension

PwC

s as grow eng nes or e economy

Interest subvention of 1% on home loans uptoINR 1 million to be extended for one more year

upto March 31, 2011

A port facility to be set up at Sagar Island in the

State of West Bengal

26% enhanced allocation to Backward Region

Grant Fund to bridge the infrastructure gap in

backward districts

Agriculture

Four pronged strategy to be adopted for

promoting agricultural growth

- Agricultural production

- Reduction in wastage of produce

- Credit support to farmers

- Thrust to food processing sector

Additional banking / NBFC licenses to be issued

to private sector

Regional Rural Banks to be provided additional

capital for increased lending to rural economy

Financial Stability and Development Council to

be set up for monitoring macro prudential

supervision of the economy

Financial Sector Legislative ReformsCommission to be set up to rewrite and clean up

the financial sector laws

Banking and insurance facilities to be provided to

habitations having population exceeding 2000,

by March 2012

Government contribution of INR 1000 per annum

to each NPS account to extend coverage to

unorganised sector

8/8/2019 PwC Budget Flash 2010 - 2011

2/11

8/8/2019 PwC Budget Flash 2010 - 2011

3/11

8/8/2019 PwC Budget Flash 2010 - 2011

4/11

8/8/2019 PwC Budget Flash 2010 - 2011

5/11

8/8/2019 PwC Budget Flash 2010 - 2011

6/11

CENVAT

Tariff

General

The standard ad valorem excise duty rates increased from 8% to 10% on

non petroleum products.

Excise duty exemption granted on the following categories of products

(effective February, 27, 2010 )

- Supari other than scented supari- Fractioned /De- terpenated mentha oil

- De mentholised oil

- Spearmint oil

- Mentha piperita oil

- Any intermediate or by product arising in the manufacture of menthol

- Toy balloon made of natural rubber

- Micro processor for computers (other than mother board)

- Floppy disc drive

- Hard disc drive

- Flash drive

- CVD/ DVD

- Combo drive for external use

- Electrically operated vehicles including two and three wheeled electric

motor vehicle

- Blood glucose monitoring system

- Products wholly made of quilted textile material

- Specified medical equipments

Products where excise duty rates has been increased from 4% to 10%

(effective February, 27, 2010 )

- Open top sanitary cans

- Goggles other than those used for correcting vision

Products where excise duty rates has been reduced from 8% to 4%

(effective February, 27, 2010 )

Budget Flash 2010 - 2011PricewaterhouseCoopers

- , ,

refrigerated vehicle for preservation, storage, transportation of apiary,horticulture, dairy, poultry, aquatic and marine produce

- Parts of battery chargers and hands free headphones of mobile

handsets including cellular phones

- Specified goods required for initial setting up of solar power generation

projects

- Self loading and self unloading trailers and semi trailers for agricultural

purposes

Products where excise duty exemption has been withdrawn (effectiveFebruary, 27, 2010 )

- Tapioca starch and maize starch

- Avgas

- Baby and clinical diapers

- Sanitary napkins

- Mosquito nets

- Umbrella panel

- Potato starch- Later rubber thread

- Cartons , boxes and corrugated paper or paper board

- LED light

- Replaceable kits of domestic water filters except those operating on

reverse osmosis technology

Other Changes

The specific rates on cement and cement clinkers have been revised

upwards.

The excise duty rates on cigarettes and tobacco products have been

increased.

The excise duty rates on petrol and diesel has been increased by Re 1 per

litre.

8/8/2019 PwC Budget Flash 2010 - 2011

7/11

8/8/2019 PwC Budget Flash 2010 - 2011

8/11

8/8/2019 PwC Budget Flash 2010 - 2011

9/11

8/8/2019 PwC Budget Flash 2010 - 2011

10/11

prospecting or extraction or production of mineral oils and natural gas in

the Exclusive Economic Zone and the Continental Shelf of India and for

supply of any goods connected with these activities. Suitable changes

have also been made in the Export Rules and Import Rules

- Notification No. 5/2006-CE (NT) pertaining to refund of service tax hasbeen amended to remove the bottlenecks in refund of accumulated

credit to the exporters

Goods and Service Tax (GST)

The Finance Minister has announced the date of introduction of the dual

Goods and Service Tax (GST) to be April 1, 2011. The Finance Minister has

indicated that concerted efforts of the Empowered Committee and the

Finance Commission in the last few months has lead to a broad consensus

on the introduction of GST and has carved a platform for future discussions in

finalizing the structure of GST and the modalities surrounding its introduction.

The Budget 2010 is a landmark one in the history of indirect reforms as it not

only brings clarity on the introduction of GST but marks the Government's

commitment to expedite its introduction

Budget Flash 2010 - 2011PricewaterhouseCoopers

As a step towards introduction of GST, various measures have beenannounced in the Union Budget. These include increase in the level of excise

duty to 10% signifying a single rate of tax for goods and services,

rationalization of duties and broadening of the tax base by way of introduction

of new taxable services

8/8/2019 PwC Budget Flash 2010 - 2011

11/11