Indian Union Budget 2021-22, Central Excise changes
Central Excise Duty changes under Indian Budget 2021-22
EXCISE
Note: (a) “Basic Excise Duty” means the excise duty set forth in the Fourth Schedule to the Central Excise Act, 1944.
(b) “Road and Infrastructure Cess” means the additional duty of central excise levied under section 112 of the Finance Act, 2018.
(c) “Special Additional Excise Duty” means a duty of excise levied under section 147 of the Finance Act, 2002.
(d) “NCCD” means National Calamity Contingency Duty levied under Finance Act, 2001, as a duty of excise on specified goods at rates specified in seventh schedule to Finance Act, 2001
(e) Clause Nos. in square brackets [ ] indicate the relevant clause of the Finance Bill, 2021.
(f) Amendments carried out through the Finance Bill, 2021 come into effect on the date of its enactment, unless otherwise specified.
- I. AMENDMENT IN THE FOURTH SCHEDULE
S.No.
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Amendment
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Clause [ ] of the
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Finance Bill, 2021
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1.
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Amendment in Fourth Schedule made by Notification
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No. 08/2019-CE (T) dated 31.12.2019 shall be made
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[98]
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effective w.e.f. 01.01.2020, retrospectively.
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2.
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New tariff items [2404 11 00] and [2404 19 00] inserted
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in Chapter 24 in the fourth Schedule of the Central
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Excise Act, 1944 accordance with upcoming
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[96 (ii)]
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Harmonised System 2022 Nomenclature and to
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prescribe tariff rate of 81% on these tariff items with
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effect from 01.01.2022.
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- II. Retrospective amendment in Chapter 27 of the Fourth Schedule to the Central Excise Act, 1944.
No.
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Amendment
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Clause of the Finance
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Bill, 2021
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1.
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(i) It is proposed to specify correct IS “17076” against
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[97 (i)]
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the tariff item 27101249 and made effective from
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98
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01.01.2020, retrospectively.
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2.
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(ii) It is proposed that tariff rate of 14%+ Rs. 15.00 per
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litre against tariff item 2710 20 10 and 2710 20 20 may
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[97 (ii) and 97 (iii)]
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be prescribed and made effective from 01.01.2020,
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retrospectively.
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- III. Amendment in Chapter 27 of the Fourth Schedule to the Central Excise Act,
1944.
Tariff items 2709 10 00, 2709 20 00, and the entries are being substituted relating thereto as under: [to be made effective from 01.04.2021] [Clause [96(i)] of the Finance Bill, 2021]
Tariff Item
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Description of goods
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Unit
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Rate of duty
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2709
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Petroleum oils and oils obtained
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from bituminous minerals, crude
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2709 00 10
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petroleum crude
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Kg.
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Nil
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2709 00 20
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other
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Kg.
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…..
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IV. IMPOSITION OF AGRICULTURE INFRASTRUCTURE AND DEVELOPMENT CESS (AIDC) ON PETROL AND DIESEL
An Agriculture Infrastructure and Development Cess (AIDC) as an additional duty of excise has been proposed on Petrol and High speed diesel vide Clause [116] of the Finance Bill, 2021. This cess shall be used to finance the improvement of agriculture infrastructure and other development expenditure. The details of the cess are as under:
S. No.
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Commodity
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Rate of AIDC [Clause [116] of the
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Finance Bill, 2021]*
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1
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Motor spirit commonly known as petrol
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Rs. 2.5 per litre
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2
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High speed diesel
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Rs. 4 per litre
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*Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931.
V. CHANGE IN EFFECTIVE RATE OF BASIC EXCISE DUTY AND SPECIAL ADDITIONAL EXCISE DUTY ON PETROL AND DIESEL [to be effective from 02.02.2021]
Consequent to imposition of AIDC, the Basic Excise Duty (BED) and Special Additional Excise Duty (SAED) on Petrol and High-speed diesel is being reduced so that consumer does
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not have to bear any additional burden on account of imposition of AIDC. The revised duty structure on petrol and HSD shall be as follows.
A
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Item
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BED
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SAED
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AIDC
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(Rs/Ltr)
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(Rs/Ltr)
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(Rs/Ltr)
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1
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Petrol (unbranded)
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1.4
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11
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2.5
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2
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Petrol (branded)
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2.6
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11
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2.5
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3
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High speed diesel (unbranded)
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1.8
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8
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4
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4
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High speed diesel (branded)
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4.2
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8
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4
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VI. EXEMPTIONS FOR M-15, E-20 AND OTHER BLENDED FUELS
S. No. Amendment to central excise notifications
- Exemptions from cesses and surcharges on the lines of other blended fuels (like E-5 and E-10) if these blended fuels are made of duty paid inputs
VII. Amendments in the Schedule VII of the Finance Act 2001 (NCCD Schedule)
- New tariff items [2404 11 00] and [2404 19 00] inserted in accordance with upcoming HS 2022 Nomenclature and prescribe NCCD of 25% on these tariff items with effect from 01.01.2022.