Union Budget 2024: FM Sitharaman slashes customs duty on gold, silver, mobile phones

Union Budget 2024: Finance Minister Nirmala Sitharaman, in her Union Budget 2024 speech, said that the government will strive to further simplify and rationalise the tax structure of GST and endeavour to expand it to the remaining sectors. 

She proposed a comprehensive review of the rate structure over the next six months to rationalise and simplify it for ease of trade, removal of duty inversion and reduction of disputes. 

Here's what Nirmala Sitharaman announced on specific customs duty:

Medicines – FM Sitharaman proposed to fully exempt three more medicines for cancer patients from customs duties. She also proposed changes in Basic Customs Duty (BCD) on X-ray tubes, and flat panel detectors for use in X-ray machines.

Mobile phones – There has been a three-fold increase in domestic production and a 100-fold jump in exports of mobile phones in the last six years. She proposed to reduce BCD on mobile phones, mobile PCBA (Printed Circuit Board Assembly) and mobile charger to 15 per cent. 

Minerals – The FM proposed full exemption of customs duties on 25 critical minerals and reduction of  BCD on two of them. Critical minerals include lithium, copper, cobalt and rare earth elements that are critical for sectors like nuclear energy, renewable energy, space, defence, telecommunications, and high-tech electronics.

Solar energy – She proposed to expand the list of exempted capital goods for use in the manufacture of solar cells and panels. She also proposed to not extend the exemption of customs duties for solar glass and tinner copper interconnect.

Marine products – To enhance the competitiveness of India’s seafood exports, FM proposed to reduce BCD on certain broodstock, polychaete worms, shrimp and fish feed to 5 per cent. She also proposed an exemption of customs duty on various inputs for manufacture of shrimp and fish feed.

Leather and textile – FM proposed making additions to the list of exempted goods for manufacture of leather and textile garments, footwear and other leather articles for export. She further proposed the simplification and rationalisation of the export duty structure on raw hides, skins and leather. 

Precious metals – The FM proposed reducing customs duties on gold and silver to 6 per cent and that on platinum to 6.4 per cent.

Other metals – FM Sitharaman proposed to remove the BCD on ferro nickel and blister copper, while continuing with nil BCD on ferrous scrap and nickel cathode, and concessional BCD of 2.5 per cent on copper scrap.

Electronics – She proposed the removal of BCD on oxygen free copper for manufacture of resistors.

Chemicals and petrochemicals – The minister proposed to increase BCD on ammonium nitrate from 7.5 to 10 per cent. 

Plastics – She proposed to raise the BCD on plastics from 10 to 25 per cent to curb their imports.

Telecommunication equipment – FM Sitharaman proposed to increase the BCD on PCBA of certain telecom equipment from 10 to 15 per cent to incentivise domestic manufacturing. 

Trade facilitation – FM proposes extension of the period for export of goods imported for repairs from 6 months to 1 year. She also proposed to extend the time-limit for re-import of goods for repairs under warranty from 3 to 5 years.