Some of the home improvement and furnishing items will become costlier as the Finance Minister, Nirmala Sitharaman has decided to hike the customs duty of certain items. Also, the aim of the government is to encourage entrepreneurs to produce locally than import from other countries and sell here. Duty hike on certain items had become in certain cases had become necessary as cheaper Chinese goods were flooding the market and locally produced items were finding it difficult to survive in the market.
“Make in India is a cherished goal. In order to provide domestic industry a level playing field, basic customs duty is being increased,” said the Finance Minister in her Budget speech. As a result, Budget 2019 contains hike in customs duty of some of the products.
Duty hikes were necessitated as cheap products were flooding the market and the domestic manufacturers were demanding a level playing field. In case of certain products like marble slabs the government claims a duty hike became necessary due to duty inversion.
|Particulars||Existing Customs Duty||New customs duty|
|Poly Vinyl Chloride||7.5%||10%|
|Floor cover of plastics, Wall or ceiling coverings of plastics||10%||15%|
|Articles of plastic||10%||15%|
|Ceramic roofing tiles and ceramic flags and pavings, hearth or wall tiles etc.||10%||15%|
|Base metal fittings, mountings and similar articles suitable for furniture, doors, staircases, windows, blinds, hinge for auto mobiles||10%||15%|
|Indoor and outdoor unit of split system air conditioner||10%||20%|
Certain sectors like tiles were reeling under depressed prices more due to domestic factors like sudden spurt in manufacturing capacity than competition from cheap imported products. However, the industry feels hike in duty provides a cushion against possible dumping by other countries.
However, architects and interior designers only hope that hike in customs duty does not provide a reason for domestic manufacturers to hike their product prices. A hike in domestic prices at this juncture when industry is facing liquidity crisis, would only change the situation bad to worse.