The Vijay Kelkar-led task force on indirect taxes has recommen- ded a two-tier excise duty structure of 16 per cent and 8 per cent, reducing special excise duties to 12 per cent from the current 16 per cent, a 5 per cent cut in the peak Customs duty from 30 per cent now, besides doing away with a host of exemptions for the next financial year.
It has also asked for a 16 per cent excise duty on petroleum products, along with a 5 per cent basic customs duty differential between crude and other petroleum products, and reducing the number of export promotion schemes to two.
Releasing the consultation paper at a press conference today, Vijay Kelkar, adviser to the finance minister, said the two key elements of the paper were removal of transaction costs and ensuring stability in fiscal practices.
The report quotes an Exim Bank study to say that reducing transaction costs in exports will yield a gain of Rs 4,000-5,000 crore a year for the economy.
The paper is part of finance minister Jaswant Singh
