Excise Duty & Service Tax cut by 2% , Sensex Upbeat

Another dose of stimulus to the economy came today from the UPA government in form of Excise duty and Service Tax Duty. The government has announced Reduction of Excise Duty from 10% to 8% and Service Tax from 12% to 10%. The 2% cut is in addition to the 4% Cenvat Reduction announced earlier.

The BSE Sensex took the news positively and pared major part of the losses. The move is expected to help industries pass on the benefit of lower price to the consumer and hence boost the consumption which would help the economy to make a comeback. The move is going to cost  RS. 30,000 crore to the government coffers.

The notification in respect of the duty and Tax cut by Central Board of Excise and Customs (CBEC)  is expected by tonight or tomorrow.