What's cheaper and what's costlier for consumers?
New Delhi, Feb 1, 2025
Budget 2025: This is the second full Budget under the Modi 3.0 government. Check the full list of items that will become cheaper or costlier after Budget 2025
As Finance Minister Nirmala Sitharaman presented her eighth consecutive Union Budget today, all eyes were on the items that have either become affordable or more expensive for consumers.
This is the second full budget under the Modi 3.0 government, following its return to power in the 2024 Lok Sabha elections. This year's budget focuses on ten key areas, including agriculture, manufacturing, employment, MSMEs, rural development, and innovation.
FM Sitharaman emphasised in her speech that the Budget's goal is to introduce transformative reforms.
Budget 2025: What items have been made more affordable
* 36 life-saving medicines have been exempted from Basic Customs Duty.
* The government has proposed full exemption from Basic Customs Duty on lead, zinc, and 12 other minerals.
* Raw materials for shipbuilding are now exempt from Basic Customs Duty for an additional 10 years.
* Last year’s budget had already resulted in price reductions for mobile phones, gold, silver, and copper.
* Three cancer treatment drugs were also removed from the Basic Customs Duty list.
The government had also proposed an increase in customs duty on non-biodegradable plastics to 25 per cent and raised the Basic Customs Duty on certain telecom equipment from 10 per cent to 15 per cent in the Budget 2024.
Additionally, the Finance Minister had proposed a thorough review of the customs duty framework within six months, making it likely that significant changes to customs duties will be announced in the 2025-26 Budget.
Meanwhile, ahead of the Budget Speech on Saturday, both gold and silver prices saw an uptick. In Mumbai, the price of 24-carat gold rose by Rs 160, reaching Rs 84,490 per 10 grams, while the price of 22-carat gold increased by Rs 150 to Rs 77,450 per 10 grams.
Budget 2025: What items have been made costlier
Items facing price increases
While numerous essential products will experience a reduction or exemption in customs duties, certain goods, particularly in the tech and manufacturing sectors, are expected to see higher costs.
Customs duty hike on interactive flat panel displays
The government has proposed raising the Basic Customs Duty on interactive flat-panel displays from 10 per cent to 20 per cent. This adjustment is aimed at addressing the inverted duty structure and creating a fairer competitive environment for domestic manufacturers of these products.
New time limit for provisional assessment
A new two-year time limit has been introduced for provisional assessments, designed to facilitate faster and more efficient customs clearance. This reform will impact industries involved in imports and exports by making the process more transparent and predictable.
Other adjustments to tariff structure
Streamlining of tariff rates: The Budget also suggests eliminating seven tariff rates, building on the removal of seven rates in the 2023-24 Budget. This initiative is part of an ongoing effort to simplify the customs tariff system and improve trade efficiency.
Exemption from social welfare surcharge: The Social Welfare Surcharge will be exempted on 82 tariff lines that are subject to a cess, easing the overall tax burden on businesses and industries dealing with these products.
[The Business Standard]
