The Hindu Business Line : 8-digit classification code for excise from Budget day

THE Union Budget day - February 28 - would see the implementation of a significant tax reform measure on the central excise front even though there may be no mention of this development in the Finance Minister Mr P. Chidambaram's Budget speech.

All central excise tariff headings would have the Harmonised System of Nomenclature (HSN) based eight-digit classification code from that date.

The Finance Ministry on Thursday issued necessary notifications to enable the expansion of the tariff classification of excisable goods to an eight-digit code from the existing six-digit code.

Parliament had last year passed a law — Central Excise Tariff (Amendment) Act 2004 — to facilitate this change in the numbering scheme. The Revenue Department had adopted eight-digit classification for levy of import duty with effect from February 1, 2003.

The Directorate General of Foreign Trade and the Directorate General of Commercial Intelligence and Statistics have also adopted eight-digit classification code for the purpose of import trade control policy and collection of statistics.

The implementation of the eight-digit classification code for excise would in a way accommodate the demand from trade and industry for the adoption of common commodity classification (based on internationally adopted HSN) to be used for all trade related transactions to facilitate international and domestic trade.

The introduction of eight-digit code is also expected to remove the difficulties arising due to divergence in classification by different departments and agencies. It would also facilitate collection and compilation of specific data on commodities of special significance to India and sharing such data among various agencies.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page