Cars, fuel, ACs, TVs, gold and silver jewellery, cigarettes and other tobacco products will cost more in the new fiscal with Finance Minister Pranab Mukherjee proposing a hike in duties and change in tax structure on these items in the Budget for 2010-11.
As part of a partial withdrawal of stimulus measures, given the recovery seen in the economy, Mr. Mukherjee announced hiking excise duty on non-oil products to 10 per cent from 8 per cent across all sectors.
Within minutes, car manufacturers announced that they would hike prices while Government officials said that petrol and diesel would cost Rs 2.67 and Rs 2.58 more per litre, respectively, from midnight tonight.
Perhaps, Mr. Mukherjee wanted to create more demand by giving more tax concessions and provide more money in consumers’ hand so that they buy more and boost the industry and economy.
Prices of consumer durables and electronic items are set to go up, although mobile handsets made in India and accessories will see price cuts with the government providing exemption in customs duty on import of key components.
The Finance Minister also increased excise on petrol and diesel by Re. 1 per litre, following which duty on branded petrol will now be Rs 15.5 per litre and that of branded diesel will be 5.75 per litre. Non-branded petrol will attract duty of 14.35 per litre and that of diesel will be 4.60 per litre.