This document summarizes the key proposals and impacts from a presentation on changes to India's service sector. Some of the main points include: standard excise duty rates are increasing which will make consumer goods like electronics and vehicles more expensive; service taxes on items like telecom, travel, and hospitality are also increasing; however, some essential goods and services like LED lights and gold coins will become cheaper due to duty changes. The presentation provides investors an overview of how the Indian budget's tax revisions could affect various industries.

1. SIMER

2. Presentation on Impact on
service sector
Presented by:-
K. Joshi babu & Anita kurmi

3. Proposal
and
Impact

4. P:- Standard excise duty rate is increased from
10.3% to 12.36%.
I:- Consumer durables and other goods such as washing
machine, air conditioner , laptops, toys, wrist watches,
two-wheelers, perfumes, etc will now be costlier by 1%
to 1.5%.

5. P:- Concessional rate of excise duty of 1.03% and 5.15% is
increased to 2.06% and 6.18% respectively on many specified
products.
I:- Basic and necessary goods such as tooth powder,
spectacles/ lenses, sewing machines, pens, pencils, sugar
confectionary, pastry, cakes, paper, drugs, medical equipment,
etc will now be costlier by 0.5% to 0.7%.

6. P:-Service tax rate to increase from 10.3% to 12.36%
I:- Services such as telecommunication/ mobile, internet, pest
control, commercial coaching, beauty and health treatment,
courier, etc will be costlier by 2.06% flat. Households bill for a
monthly spend of Rs 10,000 on services likely to go up by Rs
200.

7. P: - Basic excise duty on petrol cars with engine
capacity between 1200cc to 1500cc is
increased from 22.66% to 24.72%.
I:- A mid-sized salon car with ex-showroom
price of Rs 7 lakh will be costlier by Rs 8,000 to
Rs 10,000.

8. P:- Excise duty abatement on branded readymade garment
for excise duty is increased from 55% to 70%.
I:- A branded jeans costing Rs 2,000 is likely to be cheaper
by Rs 20.

9. P:- Excise duty on cigarettes of length
exceeding 65 mm increased by adding an ad
valorem component of excise duty of 10% and
such rate shall apply on 50% of retail selling
price.
I:- A pack of cigarettes of length exceeding 65
mm costing Rs 120 will now cost
between Rs 125 and Rs 130.

10. P:- Service tax is proposed to be levied on passenger travel
by rail in first class or air conditioned coach with or
without unaccompanied goods on a value equal to 30%
of fare.
I:- In addition to proposed rise in first class and air-
conditioned coach fares by the Railway Budget, service
tax of 3.7% will apply. Thus, a 3-tier AC ticket in Rajdhani
Express from Mumbai to Delhi costing Rs 1,470 will now
cost Rs 1,525.

11. P:- Abatement of 50% in value available to
hotels, inns, guest houses, clubs, campsites for
residential or lodging purposes has been
reduced to 40%.
I:- Stay in five-star hotel costing Rs 6,000 per
night will now be expensive by Rs 136.

12. P:- Service tax on air travel is proposed to be
changed from existing lump sum payment per
ticket to ad valorem tax rate on specified value
of air fare. Effectively service tax at 4.8%
would be payable on the air fare.
I :- A Mumbai-London return air ticket in an
economy class with a fare of Rs 30,000 will
cost dearly by at least Rs 700.

13. P:- Basic excise duty of 1% on branded silver
Jewellery to be done away with.
I:-Silver Jewellery costing Rs 20,000 will be
cheaper by Rs 200

14. P:- Basic excise duty on LED lamps reduced to
NIL.
I:- Now on a Rs 150 LED lamp, one should
save as much as Rs 10.

15. P:- Basic customs duty raised from existing
10% to 30% on imported bicycles .
I:- Now a branded luxury bicycle costing Rs
15,000 will now cost between Rs 17,000 and
Rs 19,000.

16. P:- Limit of duty-free allowance on return to India from
international journey hiked from Rs 25,000 to Rs 35,000 for an
overseas stay of more than three days (it is hiked from Rs
12,000 to Rs 15,000 for a shorter stay).
I:- The change, for example, ensures an additional savings of
approximately Rs 3,500 for passengers who have shopped for
at least Rs 35,000 with an international stay of more than 3
days

17. P:- Basic excise duty on gold coins with 99.5%
purity reduced from existing 1.03% to NIL.
I:- A 10 gm 99.50% pure gold coin costing Rs
28,000 set to be cheaper by approximately Rs
275.

18. P:- limit for levy of service tax on monthly
maintenance charges payable to a housing
society for an apartment has been increased
from Rs 3,000 to Rs 5,000.
I:- The tax outgo will stand reduced and the
flat owner will benefit to that extent.
Methodology: We have taken the MRP of
popular brands across each item in this table,
factored in a tentative distributor's margin and
then computed the indicative impact of
budget announcements.

19. Thank You