The Union Finance Minister Shri Pranab Mukherjee has proposed to enhance the abatement from 40% to 55% of the Retail Sale Price for the Small Scale Industries (SSI) Garment Manufacturers. With this relief, a unit would continue to be eligible for SSI exemption in 2011-12, even if it had a turnover based on Retail Sale Price of Rs 8.9 crore in the current year. The necessary notification in this regard will be issued in due course. This was announced by the Union Finance Minister while initiating the discussion on the Finance Bill 2011-12 in the Lok Sabha today.
The Union Finance Minister also announced the basic reduction of custom duty on raw silk (not thrown) from 30 per cent to 5 per cent ad valorem. This was done to augment domestic availability for weavers, both in the handloom and the power loom segments, Shri Mukherjee added. The Finance Minister said that a number of representations supporting and opposing this move have been received. Responding to them, the Finance Minister said that he would like to assure the House that the Government would keep a close watch on import volumes and domestic prices and respond, if required, to mitigate any adverse impact on the domestic sericulture sector.
The Union Finance Minister Shri Mukherjee said that it has been decided to exempt the new levy in its entirety both in respect of services provided by hospitals, as well as by way of diagnostic tests until GST comes into force. This has been done in view of considerable anxiety raised in this regard in the Parliament and outside, the Finance Minister added. He said that the purpose of the new levy was not mobilise revenues but to pave the way for the introduction of the GST.
Beside above, outlining a significant legislative agenda for reforms in the financial sector, the Union Finance Minister Shri Mukherjee introduced the Constitution Amendment Bill to facilitate the GST in Lok Sabha today. Beside it, the Finance Minister said that three more bills namely, the revised Pension Fund Regulatory and Development Authority Bill, the Bill on Factoring and Assignment of Receivables and the State Bank of India (Subsidiary Banks Laws) Amendment Bill will be introduced in the coming days. To complete this legislative work, the Finance Minister sought the cooperation of Hon’ble Members in collective national interest.
The Finance Minister Shri Mukherjee emphasised the importance of staying our course on the tax reforms, the enactment of the DTC and the Constitutional amendment to facilitate the implementation of GST from the next fiscal year. He said that half-measures in these reforms, by insisting on concessions and exemptions will only add to the complexity and distortions of the tax regime, which will compromise the intended benefits from these measures.
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