Budget Speech - PART B
Small Scale Sector
- The small scale sector makes an important
contribution to our overall production, provides gainful employment and
also contributes to our export effort. It is the declared policy of
this Government to free the small scale industry from the rigours of
cumbersome procedures. In line with this objective, I have
radically simplified the scheme of excise duty concessions for the
small scale units. I intend to continue the full exemption from duty
on clearances upto Rs.30 lakhs in a financial year. Thereafter,
a small scale unit would be required to pay a flat rate of excise
duty on clearances beyond Rs.30 lakhs and upto Rs.100 lakhs, if
the small scale unit does not avail of any modvat credit on duty
paid inputs. The flat rate of duty will be 3% ad-valorem on
clearances between Rs.30 to Rs.50 lakhs and 5% ad-valorem on
clearances between Rs.50 to Rs.100 lakhs. The flat rate will apply for
all specified goods to which the small scale exemption scheme
is applicable. In the revised scheme of exemption, the small
scale units will not be required to maintain complicated records
for availing modvat. They will also not be required to determine
the classification of goods.
- In order to curb avoidance from payment of duty,
I have decided to exclude a few items like cotton yarn and
texturised man-made yarn from the purview of the SSI
exemption scheme.
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