- General excise duty rate is being enhanced from 10% to 12%.
- Basic customs duty on Titanium dioxide classified under CTH 2823 00 10 is being reduced from 10% to 7.5%.
- During the Twelfth Plan period, infrastructure investment will go up to Rs 50 lakh crore.
- So as to encourage housing loans the Government has also Enhance provisions under Rural Housing Fund from Rs 3000 crore to Rs 4000 crore, Extend the scheme of Interest subvention of 1% on housing loans up to Rs 15 lakh where cost of house does not exceed Rs 25 lakh for another year.
- No change in corporate tax.
The Government has considered industry plea of cut customs duty on Tio2 which is a positive for the Paint industry amidst spike in the Tio2 prices. However, the general increase in the excise duty from 10% to 12% will result in higher excise incidence, and needs to be passed on through hike in paint prices.
Scrips to watch:
Asian Paints, Kansai Nerolac, Berger Paints, Akzo Noble etc
The Union Budget has brought more negative impact than a relief for the Paint Industry. While the cut in customs duty on Tio2 7.5% will help in improving margins of the industry, the increase in the excise duty to 12% on paints will make different paint products dearer. On the other hand, thrust on infrastructure sector and rural development will also aid the industry growth.