No cheer for housewives: durables to be dearer
Written by fe Bureaus
| Updated: Feb 27 2010, 06:28am hrs
What with food inflation at 12% and the prices of vegetables and groceries shooting up, housewives are a harassed lot. While the finance minister has made life earlier by giving some relief on income tax, the increase in the prices of petrol and diesel could have cascading effect pushing up prices on a host of household goods. That apart the increase in the excise duty of 2% could also push up prices of branded foods. So, housewives may have to learn to live with paying more for not just fuel but also vegetables, biscuits, fast moving consumer goods (FMCG), television sets, fans, two wheelers and air conditioners. At the same time, hike in excise duty from 8% to 10% is going to increase the prices for branded products like, consumer durables, electronic items, biscuits, jams, soaps, shampoos, tea, coffee and other FMCG products. Expect your favourite Parle-G too to cost more now. Praveen Kulkarni, director (marketing), Parle Products, said, We are already reeling under rising input costs and inflationary pressures. Hike in excise duty now will add to our costs. Theres no question of absorbing anything now. Cereals and pulses will be exempted from service tax while transportation by rail will remain exempted. The infusion of Rs 300 crore to enhance productivity of dry land farming areas for pulses and oil seeds may push the supply side and help maintain current food-inflation levels, said tax expert, H P Ranina. At the same time the new income tax bracket for Rs 8 lakh per annum salary is going to bring a additional spending power of Rs 50,000, he added. What has been lacking in the Budget is the governments stick mechanism to check on profiteering that determines the cost structure and brings an impact on inflation, said Indranil Deb, principal, Mobius Strip Capital Advisors. Indian mobile handsets and accessories will be cheaper as the government has provided exemption in customs duty on import of key components. It would be a good year to buy microwave, as customs duty one of its key-component in production namely magnetron will see reduction from 10% to 5%. Also, long pepper and asafoetida would cost less with reduction in basic duty from 70% to 30% and 30% to 20% respectively. Also, the FM announced reduction in central excise duty on replaceable kits for household type water filters other than those based on RO technology by 4%.