New central excise law in the offing
₹3 trillion from central excise in FY24, a bit lower than ₹3.19 trillion collected in the year before. The finance ministry said that the Central Board of Indirect Taxes and Customs (CBIC) has sought feedback on a draft Central Excise Bill, 2024 by 26 June as part of the pre-legislative consultative process. Considering the time of the release of the draft law for comments and the timeline for submission of comments, it appears this new bill might be introduced in the upcoming budget session, said Gunjan Prabhakaran, partner and leader of indirect tax at BDO India.“Once enacted, the Bill shall replace the Central Excise Act, 1944.
The Bill aims to enact a comprehensive modern central excise law with an emphasis on promoting ease of doing business and repealing old and redundant provisions," the ministry said. The proposed Bill has twelve chapters, 114 sections and two schedules. Replacing archaic laws has been a legislative agenda for the National Democratic Alliance (NDA) government.
Over time, multiple amendments to the law make the provisions complicated and difficult to comprehend. Replacing it with a modern law could help professionals and businesses in compliance. Although the industry has been demanding inclusion of crude oil and petroleum products within GST, it could not be achieved due to lack of consensus as states are not very keen to give up their taxation powers on these items in favour of the GST Council.
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