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Excise duty goes on computer hardware items

Our Bureau

New Delhi , Jan. 16

THE Finance Ministry has scrapped the 16 per cent excise duty applicable on manufacture of microprocessors for computers (other than motherboards) and storage devices - hard disk drives, floppy disk drives, CD-Rom drives.

With this move, the Revenue Department has corrected what the PC manufacturers termed as a "duty anomaly" arising from the Government's recent decision to halve the excise duty on computers from 16 per cent to 8 per cent.

Besides the reduction in excise duty on computers, the Ministry had on January 8, removed the 4 per cent special additional duty of customs (SAD) and also reduced the peak rate of customs duty to 10 per cent from 15 per cent.

"With the anomaly now been rectified, PC manufacturing will thrive and PC price reduction to the order of 10-12 per cent can be expected.

The Government has taken a significant bold step to facilitate migration (of the consumer) from the grey market to the organised (market) by reducing the excise duty on storage devices and microprocessors to nil," Mr Vinnie Mehta, Executive Director, MAIT said in his reactions to the latest decision of the Finance Ministry.

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