Budget 2024: Gold, Cellphones, Cancer medicine now cheaper
By TIOL News Service
NEW DELHI, JULY 23, 2024: THE Union Budget of 2024 brought with it many changes in the Customs policy, with the aim of supporting domestic manufacturing, deepening local value addition, promoting export competitiveness, and simplifying taxation, while also keeping the interest of the general public and consumers surmount. In the previous year's budget, the Government had reduced the number of Customs duty rates. In this backdrop, the present year's budget sought to undertake a comprehensive review of the rate structure over the coming six months, in order to rationalise and simplify the Customs tax structure, so as to ensure ease of trade, removal of tax inversion and reduce litigation.
Keeping sector-specific needs in mind, the Government proposes to tweak Customs tax rates in relevant sectors. The changes include -
Medical sector - Keeping in mind the relief sought to be provided to Cancer patients, the Government has exempted three drugs from Basic Customs Duty. These include Trastuzumab Deruxtecan, Osimertinib and Durvalumab. The tax rate on these has been reduced to nil, from the existing 10%. Also, the BCD rate on X-ray tubes for use in manufacture of X-ray machines for medical, surgical, dental or veterinary use, has been reduced from the existent 15% to 5% (till 31.03.2025), with a phased hike to 7.5% (from 01.04.2025 to 31.03.2026), and a further hike to 10% (from 01.04.2026). These changes also apply to Flat panel detectors (including scintillators) used in the aforementioned items.
Precious metals - Perhaps, factoring in the soaring prices of precious metals, the Government sought to provide a measure of impetus for consumption, by reducing Basic Customs Duty (BCD) reductions. The BCD rates on Gold and Silver bars and dores, has been reduced to 6% each. Moreover, the BCD on Platinum, Palladium, Osmium, Ruthenium, Iridium has also been slashed to 6.4%.
Electronics - Possibly aimed as a measure of relief towards the consumer, the Budget also proposes to relax BCD rates on cellphones to 15% from the existing 20%. This move is made keeping in mind the extensive coverage of cellphone and massive data consumption. BCD rates on cellphone components like Printed Circuit Boards and charges is similarly reduced to 15%. The tax rates on specified cellphone components is also brought to nil.
Renewable energy - In keeping with the Government's move to transition to clean energy, the Budget proposes BCD rate reduction on specified capital goods for use in manufacture of solar cells or solar modules, and parts for manufacture of such capital goods, to nil, from the existing 7.5%. Nevertheless, the rate on Solar glass for manufacture of solar cells or solar modules and Tinned copper interconnect for manufacture of solar cells or solar modules has been hiked to 10% & 5% respectively, from the existing nil rate of tax. However, these rate hikes will be in effect after 01.10.2024.
Shipping - The Budget also proposes to revise BCD rates on components and consumables for use in manufacture of specified vessels; and on technical documentation and spare parts for construction of warships.
Export duty changes
The Budget also proposes changes in Export Duty. These are to be effective from 24.7.2024. These changes include export duty reduction on Tanned or crust hides of skins, whether or not split, but not further prepared from 40% to 20% and on Raw fur skins from 60% to 40% and Tanned or dressed furskin from 60% to 20%.
Moreover, the BCD exemption for the goods covered under certain serial numbers of the notification are being extended upto 31.03.2026 unless specified otherwise.