Union Budget 2018 is just around the corner. Just ahead of it, delegations belonging to different sectors of the economy met Finance Minister Arun Jaitley and submitted respective pre-budget proposals. Information and communication technology (ICT) sector also notified Arun Jaitley about their expectations from the Budget 2018. The important suggestions received on proposals for Budget 2018 from the industry mainly included a hike in BCD to 20 percent, levy of customs duty on PCBs, reimbursement of 100 percent CGST portion on excise free zones and blockage of working capital for all the manufacturing companies. Important suggestions received on pre-budget proposals from the Industry are as under:-
1) Increase of BCD to 20 percent for consumer electronics and home appliances products: In the last few years, consumer electronics sector has not seen any major investments coming into manufacturing of consumer electronics, home appliances products. This is due to the fact that many of the brand owners find it cheaper to import finished products in view of the following issues including weak ecosystem for electronic components manufacturing, higher finance costs, strong Indian rupee, and higher duty on finished products. So, Budget 2018 should consider all these factors.
2) Levy of Customs Duty on PCBs: To encourage higher value addition, ICT recommends Finance Minister Arun Jaitley should impose a customs duty of 10 percent on populated PCBs for manufacturing of mobile phones in Union Budget 2018.
3) Reimbursement of 100 percent CGST Portion on Excise Free Zones: The Finance Minister Arun Jaitley should reimburse 100 percent of CGST portion by creating a special corpus fund in Budget 2018. This will ensure that the units in the excise free zone can function till the end of their exemption period.
4) Blockage of working capital for all the manufacturing companies especially the SMEs because of GST: The electronics industry of India therefore, requires urgent attention of the Finance Minister Arun Jaitley if we have to remain competitive in the challenging environment. The government in Budget 2018 must encourage electronics manufacturing and provide preferential tax treatment, land subsidies, financial incentives etc., besides improving the infrastructural facilities. – Financial Express