Budget reduces customs duties on several goods. How will it impact prices?

Guwahati: In the latest Union Budget announced on Tuesday, Finance Minister Nirmala Sitharaman revealed several tax reductions across various sectors. Notably, the customs duty on leather goods, footwear, and specific seafood items has been reduced.

Leather and Footwear: The government has slashed customs duty on the manufacturing of leather goods and footwear. This reduction aims to make these products more affordable for consumers, stimulate domestic production, and support the leather industry.

Seafood: The basic customs duty on specific seafood items such as brood stocks, shrimps, and fish feed has been reduced to 5 percent. This initiative is intended to boost the seafood industry by lowering production costs, which should subsequently reduce prices for consumers.

These changes are part of a broader strategy to adjust customs duties, making various goods more affordable and supporting different sectors of the economy.

Business North East spoke to the owner of 'The Bar Shop' in Guwahati, who shared his views on the impact of these changes. "While there will be a slight decrease in prices due to the reduction in customs duties, the overall impact might not be significant. The existing GST on imported products and additional costs, such as transportation, still play a major role in determining final prices. For example, the price of seafood can vary significantly across regions due to transportation costs. A seafood item priced at Rs 300 in South India can cost up to Rs 1,100 in Guwahati."

Another shop owner, Rahul Anand of Fooppers, expressed a similar sentiment. He praised the government's initiative to reduce customs duties but noted that the impact might be limited. "Imported fish like Basa and Salmon from Vietnam and Thailand have seen significant price increases over the past few years. Although the reduction in customs duty is a positive step, other factors like GST and transportation costs still affect the final prices."

The owner of Yasir Leather House, who shared his perspective on the impact of these changes. He mentioned that there will be slight price reductions due to the cut in customs duty, which will "ultimately benefit customers."

While the reduction in customs duties on leather, footwear, and seafood is a welcome move, industry experts believe that its impact on prices will be moderate due to other persistent costs.