Industry & Economy
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Budget
Corporates irked by duty anomalies
Our Bureau
New Delhi
,
March 4
CORPORATE India on Friday sought corrective action from the Finance Ministry on `inverted customs duty structures' arising from certain Budget proposals.
Corporates used the occasion of a post-budget meeting, organised by the PHD Chamber of Commerce and Industry, with the Revenue Secretary, Mr K.M. Chandrasekhar, to drive home the point that certain duty changes would result in competitive disadvantage for domestic manufacturers.
It was pointed out that certain duty changes went against the guiding philosophy of the Finance Ministry that the import duty on raw material should be lower than that of the finished products.
A case in point was the issue raised on behalf of the domestic soap manufacturers. It was held that the customs duty on the finished products would be lower (now 15 per cent) than that of raw materials (fatty acids, non-edible oil and surfactants), thereby resulting in possible cost disadvantage for domestic soap manufacturers.
Apart from soap manufacturers, representatives of refractory industry also highlighted the presence of "inverted structure" in their industry. There was also a demand from the paper industry that the excise duty on waste paper should be done away with. Representatives of the alcoholic beverage industry cried foul over the decision of the Government to hike the excise duty on molasses.
On his part, Mr Chandrasekhar said that the effort of the Government would be to try and correct the inverted duty structure so as to make it industry-friendly even while "keeping in view our constraints of expenditure for infrastructure and social spending."
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