Parity between local, imported computers again

BANGALORE: The excise abolition rollback is expected to re-instate the parity between fully-imported computers and locally-integrated ones.
MAIT executive director, Vinnie Mehta, said: "We had given them two options. Either remove the CVD or rollback. The industry expects government to stick to the option which will ensure continued flow of revenues."
The budget proposals brought down excise duty on computers to zero from the earlier 8%, while CVD on inputs/peripherals was kept untouched at 16%. On the face of it, the industry welcomed it on the assumption that exemption of excise duty means exemption of CVD.
What actually happened shocked local manufacturers. Fully-imported computers attracted only 10% customs duty, while locally integrated computers were subject to 10% customs duty and 16% CVD.
The impact was also felt incrementally. Dell, which imports its entire range of computers from Malaysia, announced a 6% price cut, while HP announced a 3-6% price reduction only on notebooks, which are imported.
Meanwhile, sale of computers has been hit as consumers have deferred their purchases in anticipation of a post-budget drop in prices.