Some changes in customs and excise duties and service tax. - Central Excise - F.No. B-1/4/2005-TRU

Some changes in customs and excise duties and service tax. D.O. F.No. B-1/4/2005-TRU DATE 02/05/2005 Post budge dated 02.05.2005 Dear Commissioner While moving the Finance Bill, 2005 in the Lok Sabha for passing, the Finance Minister has effected some changes in customs and excise duties and service tax. 2. The changes made in the customs and excise duties and service tax include the following:- (i) 4% CVD levied under section 3(5) of the Customs Tariff Act, on parts/components/accessories imported for manufacture of mobile handsets including cellular phones, has been exempted. This exemption will be available upto 30.4.2007 (notification No. 39/2005-Customs refers). (ii) Customs duty on degaussing coils has been restored to the pre-budget rate of 10% (Lists 26 26A of notification No. 21/2002-Customs as amended by notification No. 37/2005-Customs refer). (iii) The additional customs duty of 7%, levied under section 3(3) of the Customs Tariff Act, will be uniformly leviable on all computers, whether in the form of CPU, monitor, mouse and keyboard presented as a set or otherwise, including laptop computers (notification No. 76/2004-Customs as amended by notification No. 38/2005-Customs refers). (iv) Customs duty on monofilament long line system for tuna fishing has been reduced to 5%, subject to a certification by Marine Products Export Development Authority. Monofilament long line system for tuna fishing has also been exempted from additional duty of customs (CVD) by way of exemption from excise duty (S.No. 508 of notification No. 21/2002-Customs as inserted by notification No. 37/2005-Customs and S.No. 307 of notification No. 6/2002-CE as inserted by notification No. 16/2005-CE refer). (v) The optional excise duty on tyre cord fabrics of high tenacity nylon yarn of over 840 deniers has been raised from 8% to the tariff rate of 16% (S.No. 10 of notification No. 29/2004-CE as amended by notification No. 17/2005-CE refers). (vi) Excise duty on molasses has been reduced from Rs. 1000 to 750 per MT (S.No. 305 of notification No. 6/2002-CE as inserted by notification No. 16/ 2005-CE refers). (vii) Excise duty has been reduced on Isolated Soya Protein from 16% to 8% (S.No. 306 of notification No. 6/2002-CE as inserted by notification No. 16/ 2005-CE refers). (viii) Exemption from customs and excise duties, available to LPG for domestic household consumers at present, has been extended to liquefied propane butane mixture, propane and butane (S.No. 75E of notification No. 21/2002-Customs as substituted by notification No. 37/2005-Customs and S.No.10 of notification No. 4/2005-CE as substituted by notification No. 18/2005-CE refer). (ix) Service tax payable under the category of general insurance business, on the premium paid under the Farm Income Insurance Scheme of the Ministry of Agriculture, has been exempted on the lines of exemption granted to National Agriculture Insurance Scheme (notification No. 3/2000-ST as amended by notification No. 13/2005-ST refers). 3. Certain amendments have also been moved in the Finance Bill, 2005, consequent to the switchover from 6-digit to 8-digit Tariff Code for Central Excise. Excise duty exemption, as existing prior to shifting to 8-digit classification, has been restored on certain items (notification No. 3/2005-CE as amended by notification No. 15/2005-CE refers). 4. These changes come into effect from the the 2nd May, 2005. For full details, the relevant notifications may be referred. With regards, Yours sincerely, (Gautam Ray)