More For The Common Man

Items meant for consumption by the common man have either been exempted completely from the Central Value Added Tax (Cenvat) or have received more tax (and customs duty) concessions.

In a reply to the debate on the Finance Bill, finance minister Yashwant Sinha has detailed a list of such items. Now, silicon, E-Mal (an anti-malaria drug) and intravenous fluids, tapioca starch and asafoetida (heeng) will be totally exempt from Cenvat. The minister has recognised that these items are mass consumption items and removing Cenvat will help the common man.

Recognising that malaria eradication needs special attention, the Sinha has also decided to exempt Artemisinin, an input which goes into the anti-malaria drug, from basic custom duty. This will sharply reducing the price of E-mal.

Sinha has also decided to exempt biscuits which cost less than Rs 5 (maximum retail price) and weigh under 100 gms, from 50 per cent Cenvat.

This category of biscuits attracted 16 per cent Cenvat and the proposal to tax them had drawn loud protests from biscuit manufacturers. The cenvat levied on this category of biscuits will now be 8 per cent.

Sinha has also increased the duty free clearance limit of paper made from non-conventional raw materials from 2,500 tonne to 3,500 tonne a year.