The Hindu Business Line : Consumer electronics industry seeks correction of duty anomalies

THE domestic consumer electronics (CE) industry has urged the Government to correct the existing anomalies in the duty structure to allow the sector enjoy a smooth innings despite competition.

In its post-Budget recommendations, the industry, which felt largely left out in the Budget proposals for 2004-05, has drawn the Finance Minister, Mr P. Chidambaram's attention to the problem being faced by the sector due to interpretation of specific rate of excise duties on sub-assemblies of colour television (CTV) sets.

Elaborating on the issue, a Consumer Electronics & TV Manufacturers Association (CETMA) official said that the Budget proposals suggested withdrawal of the specific rate of excise duties on CTV receivers, where the retail sale price is not declared or is not correctly declared. Thus, the CTV receivers would now uniformly attract excise duties of 16 per cent.

"This will help in resolving the problems of the TV industry in future. However, at present, the specific rate of excise duty on sub-assemblies continues to be a problem with some excise authorities raising demand. These demands need to be revoked as there is no revenue issue involved in the matter and the resolution of the issue will provide relief to the CTV industry," he said.

In a representation to the Finance Minister and the Minister for Communications & Information Technology, Mr Dayanidhi Maran, the CE industry also drew the Government's attention to the impact of free trade agreement (FTA) with Thailand on the domestic manufacturers.

In order to avoid the inverted duty structure arising out of the FTA, the association has recommended reduction of Customs duty on inputs to 10 per cent.

Further, the association also sought reduction in the price of plastic, an important basic raw material for the consumer electronics industry.

Plastic is a substantial input for the industry, which constitutes 30 per cent of the cost.

"In this global environment, the price of plastic has gone up considerably, the industry has recommended that customs duty on plastic should be brought down from 20 per cent to 15 per cent," he said.

The Budget proposal has reduced Customs duty on raw materials such as aluminium, copper, steel, lead and zinc from 20 per cent to 15 per cent.

However, no reduction was announced for plastics.

More Stories on : Consumer Electronics | Budget | Excise and Customs

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