Budget 2012: FM marginally slashes excise duty levied on branded apparels

With the finance minister marginally slashing excise duty levied on branded apparels, shoppers can hope for better deals. The 10% excise duty on branded garments announced last year was levied on 45% of the maximum retail price (MRP). This year, the finance minister has proposed the duty be levied on 30% of MRP. This may bring retail prices of branded apparel down.

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Put simply, on a Rs 1,000 shirt or skirt, the manufacturer had to pay Rs 45 towards excise duty. Now, a textile company will pay Rs 36. “The announcement will see prices of private label garments coming down by 7% to 8%,” said Govind Shrikhande, MD, Shoppers Stop.

Manufacturers say the decision coupled with easing cotton prices may reduce shopping bills. Several goodies in the Budget cheered the powerloom, handloom and weaving sector . The 5% duty on import of shuttle-less looms has been slashed to zero.