In what has become India's first paperless budget, the Union Budget 2021 that was tabled by Finance Minister Nirmala Sitharaman on Monday in the Lok Sabha quickly drawn unprecedented reactions as the budget was presented amid carrying overwhelming expectations on reviving the flattened economy and addressing the healthcare crisis triggered by the COVID-19 outbreak.
Nirmala Sitharaman has presented the budget by using the 'Make in India' tablet and in the speech that lasted nearly two hours, the Finance Minister made the announcements of slapping more taxes on some of the products while decreasing them in some and let's take a look on the products that would get cheaper or costlier, stirred by the financial blueprint.
What's going to be costlier: Electronic items like Mobile phones, mobile chargers, LED lights, solar inverters, and lamps, and the other products that will demand you to pay more would be Petrol, Diesel, and Gems. An agriculture cess of Rs 2.5 per liter on petrol and Rs 4 per liter on diesel has been imposed, which would result in an increase in the prices of petrol and diesel, which are already surging at a sharp pace.
While addressing the press conference, the Finance Minister said that the Agriculture Infrastructure and Development Cess (AIDC) will not result in a price increase for end-users, a higher cess will be adjusted with lower customs duty. According to reports, the Basic Customs Duty (BCD) on gold and silver is 2.5% currently and in 2019, the duty was raised to 10% leading to a sharp increase in prices of precious metals.
The Finance Minister has said, "We have already acknowledged that solar energy has a huge promise for India. We will notify a phased manufacturing plan for solar cells and solar panels to build up domestic capacity. We are raising duty on solar inverters from 5% to 20%, and on solar lanterns from 5% to 15% currently to encourage domestic production". Along with the solar, it has been expected that the price of air conditioners and refrigerators would go high.
In the wake of an increase in the Basic Customs Duty on compressors that have been increased from 12.5% to 15%, you would be pushed to pay more for the refrigerators and air conditioners. BCD on inputs and parts of LED lights has been increased from 5% to 10% while the BCD on leather goods like wet blue chrome tanned leather, crust leather, finished leather of all kinds has been increased from 0 to 10%, which would increase the price of leather products.
The government has also increased BCD for the automobile parts like ignition wiring sets, safety glass, parts of signaling equipment from 7.5% or 10% to 15%. Along with the automobile products, the government had increased the Basic Customs Duty on gems and jewelry from 7.5% to 15%, resulting in the surge of the prices of gems. On the other hand, the Finance Minister has reduced the customs duty on alloy, stainless steel, and flux and customs duty on Naphtha has been reduced to 2.5% to correct inversion.
So what's going to get cheaper? Here are the products that would demand less from you: Iron and Steel Products, Copper Items, Insurance, Steel utensils, and Nylon Clothes. The budget was tabled with the promise of the Finance Minister that it would be like never before. However, when it was aimed that the budget will revamp the economy and put the country back on track, it had presented flaws and disappointments for the individual income taxpayers by maintaining the status quo on the taxes and for experts that Modi's Aatmanirbhar Bharat will be built by inviting the private players into some of the important sectors like highways, ports, and airports.
While the government has forecasted a growth of 11% for the coming fiscal year, the economy is projected to contract 7.7% in the current fiscal year.