Finance Minister P Chidambaram's Budget proposal to spare crude and refined vegetable oils from 4 per cent additional countervailing duty has drawn mixed reactions from various sections.

The customs duty on both crude and refined sunflower oil has also been reduced by 15 percentage points. The manufacturing industry has welcomed the step.

However, farmers' organisations have flayed the decision, saying "the finance minister is encouraging cheap imports at the expense of oilseed growers".

Among other items relating to the farmer sector, import duty on drip irrigation system, sprinklers and food processing machinery has been reduced from 7.5 per cent to 5 per cent. Import duty on pet food (for cats and dogs) has been reduced from 30 per cent to 20 per cent.

The tax exemption limit for the small-scale industries has been raised from Rs 1 crore (Rs 10 million) to Rs 1.5 crore (Rs 15 million). This would benefit many food processing units which are SSIs. Excise duty has been waived for all kinds of food mixes and biscuits having retail prices not exceeding Rs 50 per kg.

Excise duty has been reduced for plywood from 16 per cent to 8 per cent and totally waived for bio-diesel, water purification devices operating on specified membrane-based technologies, domestic water filters not using electricity, water pipes of diameter not exceeding 200 mm.

Specific rates of excise duty on cigarettes have been raised by about 5 per cent. Excise duty (excluding cess) on non-machine made biris has been raised from Rs 7 to Rs 11 per thousand and that on machine-made biris has been raised from Rs 17 to Rs 24 per thousand.

Excise duty exemption for 20 lakh (2 million) unbranded biris will henceforth be regulated to avoid misuse of the provision.

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