Taxing the memory

The frequent changes on the excise duty front in the last few years seem to have puzzled the Prime Minister’s Economic Advisory Council (PMEAC). At a recent press conference to announce the review of the economy for 2011-12, a PMEAC member said that before the 2008 crisis both the excise duty and service tax rate were at 12 per cent. The fact, however, is that the standard excise rate has never been at 12 per cent in the last four years. It was reduced from 16 to 14 per cent in the Budget in 2008. After the collapse of Lehman Brothers in September 2008, it was reduced to 10 per cent in December and further to eight per cent in February 2009 before being raised to 10 per cent in February 2010.