Industry & Economy
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Personal Products
Budget brings relief to cosmetics, shampoo cos
G. Chandrashekhar
Mumbai
,
July 13
MR P. Chidambaram has brought immense cheer to manufacturers of cosmetics, shampoo, toothpaste and pharmaceuticals by sharply reducing customs duty on certain raw material and setting right an anomaly.
Customs duty on non-edible grade industrial oils (having free fatty acid content of above 20 per cent) when imported for the manufacture of fatty acids and fatty alcohols has been reduced to 20 per cent ad valorem, from 65 per cent. Fatty acids and fatty alcohols are processed mainly out of crude palmstearine (CPS) and crude palm kernel oil (CPKO). They are used for a host of applications including in rubber, plastics, polymers, cosmetics and so on.
Earlier, customs duty on import of CPS and CPKO (with FFA above 20 per cent) was at the peak rate of 20 per cent ad valorem subject to condition that imports were used for manufacture of soap.
Excise authorities monitored the application of imported material. For any other application including production of fatty acids and fatty alcohols, import of CPS and CPKO attracted 65 per cent duty, which had led to an anomalous situation of duty on the same product being different when used for different purposes. The Finance Minister has now set a uniform rate of customs duty on CPS and CPKO.
The move is expected encourage import of CPS and CPKO. Major importers include Godrej Industries Ltd, Hindustan Lever Ltd, VVF Ltd and manufacturers in south India.
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