The Hindu Business Line : Fertiliser industry seeks duty exemption on inputs

With regard to customs duty, the FAI has urged the Government to withdraw the duty on LNG imports, project imports for fertiliser sector and for capital goods imported for expansion, modernisation, revamping and debottlenecking.

Demands
Simplification of rules for claiming duty exemption on inputs like naphtha, fuel oil, ammonia.
Concessional rate of 5 per cent for urea imported to manufacture complex fertilisers.
Withdrawing duty for capital goods imported for expansion, modernisation, revamp.

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New Delhi Feb. 11 The Fertiliser Association of India (FAI) has asked the Government for a host of tax concessions in the Budget that include total exemption from customs and excise duties for several inputs used in manufacture of various fertilisers.

It has also demanded support from the Government in facilitating conversion of naphtha and fuel oil/LSHS-based urea units into gas and LNG-based units in a way that ensures that these units do not become unviable.

In the memorandum, the Association has said that the allocation and pricing policy for feedstock should be formulated along with policy for urea, as the cost of feedstock constitutes the major portion of subsidy on urea.

On the excise front the FAI has urged for withdrawal of duty on fuel oil used for non-feed purposes in manufacture of fertilisers and also simplification of rules for claiming duty exemption on inputs such as naphtha, fuel oil/LSHS and ammonia used for manufacturing fertilisers. It has also asked for input tax credit on inputs like ammoniawhen used for non-fertiliser use.

With respect to naphtha, the FAI has asked for restoration of the earlier system of clearing naphtha for fertiliser use from refineries without payment of excise duty.

It has also asked for withdrawal of basic 16 per cent on phospho gypsum used for agricultural purposes in line with other fertiliser products which are exempted from excise duty.

Customs duty

Customs duty exemption has also been sought for import of rock phosphate, sulphur, ammonia, phosphoric acid, sulphuric acid and calcium nitrate when used for fertiliser manufacture.

The FAI has also told the Government that urea imported for manufacture of complex fertilisers should be allowed a concessional rate of 5 per cent.

The FAI demands also include exemption from taxes the cost of bagging at the port after discharge of fertilisers materials from the cost while levying customs duty on imports.

It has also urged that the procedure for project imports for the fertiliser sector should not involve certification by any authority which causes significant delays but be allowed on the basis of self certification by assesses and the exemption from levy of educational cess.