Increase in excise duty and fuel price will have an impact on costs
NEW DELHI: With Finance Minister Pranab Mukherjee rolling back the 2 per cent rate reduction in excise duty and taking it back to 10 per cent coupled with hike in diesel prices, home appliances, beauty products and other household items are all set to become dearer. However, it will only be microwave ovens and mobile accessories that will see some drop in prices.
According to LG Electronics India Managing Director Moon B. Shin: “With increase in excise duty and hike in petrol and diesel prices that will have an impact on the costs involved in freight, price hike is imminent in near future.”
Echoing similar sentiments, Samsung India Deputy Managing Director R. Zutshi said as far as the consumer electronics sector was concerned, the increase in excise duty coupled with the increase in commodity and petrol prices would lead to a cost increase which would be passed on to consumers. “The hike in excise duty and increase in minimum alternate tax (MAT) will lead to price increase, as input prices will go up and could fuel inflation to some extent,” said Godrej Consumer Products Managing Director Dalip Sehgal. Mr. Shin, however, said the five per cent deduction in excise duty on the metal component (magnetron) used in manufacturing of microwave ovens is a significant step to promote the concept of healthy cooking in India and bringing innovations to Indian kitchens. Special additional duty on mobile phones has been rolled back… this will benefit the mobile companies which import packaged mobile phones. Abolishment of excise duty on mobile phone accessories is also encouraging for consumers, he added.