The Hindu Business Line : Export duty on long steel products hiked

New Delhi, June 13 In its continuing inflation-busting efforts, the Centre has raised the export duty on long steel products used in construction and infrastructure projects from 10 to 15 per cent, alongside clamping a flat 15 per cent ad valorem duty on all iron ore shipments.

Till now, iron ore exports attracted specific duties. These ranged between Rs 50 per tonne on fines having iron content up to 62 per cent and Rs 300 per tonne on lumps and fines with ferrous content above 62 per cent.

“In order to further strengthen a policy regime that enables conservation of good quality ore and ensures its availability to domestic industry at a reasonable price, the effective rate of duty on iron ore has been enhanced to a uniform rate of 15 per cent ad valorem, irrespective of iron content,” according to a Finance Ministry release issued here on Friday.

Given that the country has been exporting iron ore to China at about $140 per tonne free-on-board (Rs 6,000 a tonne), a flat 15 per cent duty would straightaway triple the effective duty incidence to Rs 900 or so.

Simultaneously, the export duty on long products of steel (bars and rods, angles, shapes and sections, and wire) has been hiked from 10 to 15 per cent “to improve their availability in the domestic market”. However, exports of flat rolled products (including galvanised products, pipes and tubes) – used in manufacture of cars and white goods – have been “fully exempted” from duty. Currently, they range from five to 15 per cent.

Addl duty on big cars

Domestic car makes have been dealt a further blow. Cars with engine capacity of 1,500 to 1,999 cc will now be charged to a specific duty of Rs 15,000 per cent over and above the existing 24 per cent ad valorem rate. The additional levy would be Rs 20,000 on cars with capacity of 2,000 cc and above.

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