New Delhi4 months ago
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Now in the budget, the prices of goods go up and down just because of the increase or decrease in import duty. The prices of most things are decided by the GST Council.
Let us understand what became cheaper and what became expensive from this budget…
Cheap
1. Cancer medicines become cheaper: Custom duty abolished on 17 life saving drugs
The government has removed basic custom duty on 17 medicines used in the treatment of cancer. Apart from this, there will be no tax on medicines and special food imported from outside for the treatment of 7 rare diseases. This will provide great financial help to those families who are dependent on expensive foreign medicines for treatment.
2. Microwave ovens are cheap: Duty reduced on parts, domestic manufacturing will increase.
To promote domestic manufacturing, the government has made some important changes in the electronics sector. Now the custom duty on special parts used in making microwave ovens has been reduced. This may reduce the prices of microwaves in the coming days. The government aims to make India the world’s hub in consumer electronics.
3. EV batteries and solar panels are cheap: The raw material for making them becomes tax free.
Keeping in view energy transactions, the government has increased the scope of tax exemption on machines manufacturing lithium-ion batteries. Now there will be no duty on goods used for battery energy storage systems. At the same time, duty on ‘Sodium Antimonate’ used in making solar glass has also been removed, due to which it will be cheaper to make solar panels in the country.
4. Shoes, clothes can become cheaper: Discount on raw materials to increase exports
Announcements have been made for marine products, leather and textile sectors to increase exports.
- Duty free import limit for seafood exports has been increased from 1% to 3%.
- Along with leather and synthetic shoes, tax exemption will now be available on the export of ‘shoe uppers’.
Why will it be cheaper: When companies get cheaper raw materials to make goods, the cost of production will reduce. If companies pass this benefit on to the customers, then the prices of leather shoes, sports shoes and sea-food may decrease or at least the prices will remain stable.
5. Traveling abroad will be cheaper: Government reduced tax to 2%
Now booking ‘tour packages’ for foreign travel will become cheaper. Earlier, there was a 5% tax (TCS) on expenditure up to Rs 10 lakh and 20% tax (TCS) on expenditure above Rs 10 lakh. It has now been reduced directly to 2%. Now there is no limit on the amount.
6. Aircraft maintenance cheaper: Custom duty removed on parts
To promote civil aviation, custom duty has been removed on parts and components used in manufacturing aircraft. Even in the defense sector, tax will no longer have to be paid on the raw materials procured for maintenance and repair (MRO) of aircraft. This will reduce the cost of manufacturing and repairing airplanes in the country.
7. It is cheaper to import foreign goods: Tax reduced on items of personal use.
It will become cheaper to order goods from abroad for personal use. The government has reduced the tax on such goods from 20% to 10%.
Costly
- TCS on liquor has been increased from 1% to 2%. This may increase the prices of liquor, as it will affect the profit of the shopkeeper.
- Securities Transaction Tax (STT) on futures trading has been increased from 0.02% to 0.05% and options to 0.15%.
TCS stands for ‘Tax Collection at Source’. This is a kind of advance income tax. The 2% tax that the shopkeeper will pay to the government now can be adjusted while filing his Income Tax Return (ITR) at the end of the year.
STT is a tax that is levied on every transaction (buying and selling). Due to increase in tax rates, you will now have to pay more for the same transaction than before.
Knowledge Part: GST Council decides the prices of most things.
The four slabs of GST were reduced to two from 22 September 2025. Now GST is applicable only in the slabs of 5% and 18%. The decision on this was taken in the 56th meeting of the GST Council. With this, everything from buying ghee, cheese to buying car and AC has become cheaper.
Now answers to two important questions…
Question 1: If the duty changes in the budget today, will the goods at the shop become cheaper from tomorrow itself?
answer: No. This is the biggest illusion. Tax changes in the budget impact the ‘new stock’. The goods which are already kept on the shopkeeper’s shelf will be sold at the old price only. It takes time to see the impact of the budget. At the same time, the price increase or decrease is not certain. It completely depends on the companies.
Many times the government reduces duty, but companies do not reduce prices to increase their profit margins. Similarly, if raw materials become expensive in the international market, prices may remain stable or even increase despite tax reduction. That is, nothing is decided.
Question 2: Can the budget change the GST changes that took place on 22 September 2025?
answer: No. The Finance Minister does not have the authority to change the GST slab in the budget. For this, a separate meeting of the GST Council is held. The budget can only increase or decrease import duty.
