HomeFinance NewsBudget 2019: A budget to push the domestic manufacturing

Budget 2019: A budget to push the domestic manufacturing

The government has continued its focus on the ease of living, social welfare measures, infrastructure development, and ease of doing business and simpler tax compliances and administration.

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By Sachin Menon  July 6, 2019, 12:40:03 PM IST (Updated)

Budget 2019: A budget to push the domestic manufacturing
On the back of a resounding election victory, finance minister Nirmala Sitharaman presented the government’s instrumental budget for the fiscal year 2019-20, laying down its vision and action plan for the second term. The government has continued its focus on the ease of living, social welfare measures, infrastructure development, ease of doing business and simpler tax compliances.


The proposed changes in the customs duty rates point at a shift in foreign trade policy, which will help promote domestic production, maybe taking a cue from the emerging global trade war.

From tax reforms perspective, the budget proposals seem to focus on promoting make in India, ensure hassle-free GST compliances and tax administration.

FM has continued with GST tax reforms through various amendments in GST law facilitating simplification of compliance and tightening loopholes in the law as proposed by the GST Council.

The proposals include rolling out single GST return, making available accounting and GST software to SMEs with an aim to ease compliances, implementation of fully automated GST refund module as well as introducing centralized electronic invoice system from January 2020 which will dispense with the requirement of e-way bill.

In order to encourage ‘make in India’ initiative, the Union Budget proposes to increase the customs duty rates on certain raw materials, e-vehicles, renewable energy devices, electronics goods and certain capital goods. The unexpected beneficiary of this policy shift could be the FTA countries, who enjoy preferential customs duty rates. This may call for a review of procurement strategy by the Indian importers.

Further, in order to allow quick closure of the pending legacy litigation cases of excise duty, service tax and cess dispute resolution cum amnesty scheme is announced in the budget. This will provide an opportunity to the businesses to settle the legacy litigations out of court.
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