Finance Minister P. Chidambaram announced that there will be zero customs duty and VAT on non-subsidised LPG cylinders.
The Finance Minister also welcomed the decision by some of the states to raise the cap on maximum number of subsidised LPG cylinders, a family can buy in a year, from six to nine. Mr. Chidambaram also desired that more state governments would provide subsidy on LPG cylinders.
The Finance Minister also announced that the Centre had cut tax on External Commercial Borrowings (ECB) by Indian companies to five per cent from 20 per cent. The reduction in tax will encourage Indian companies to raise funds from overseas markets. The withholding tax liabilities on Indian companies, too, have been reduced to five per cent. This will apply to all borrowings between July 2012 and June 2015. Mr. Chidambaram also said that the Foreign investors’ appetite is improving.
The Finance Minister also approved the Rajiv Gandhi Equity Schemes, tailor-made to encourage first time investors. The investors will get 50 per cent tax rebate on investment under the Rajiv Gandhi Equity Schemes. The maximum investment that can be made under the scheme is 50,000 rupees.