Our Bureau

Chennai, March 3

Corrugated box manufacturers who find themselves stuck with 16 per cent excise duty on boxes want to be treated on par with their raw material supplierswho pay 8-12 per cent.

At a press conference here on Friday, Mr Lalith Lath, President, South India Corrugated Box Manufacturers' Association, said the boxes are used in almost all the industrial segments that use packaging textiles, garments, pharmaceuticals, automobiles, auto components and agriculture products. A price increase in this product will have an impact across all the segments of the industry. While their raw material suppliers, the large paper mills that produce kraft paper and duplex boards, pay 8-12 per cent excise, small players such as themselves are slapped with 16 per cent excise, he said.

Also, the food-processing sector and traders in agriculture products, who are major part of their customer base, are not covered under excise so the box manufacturers cannot transfer the excise downstream. Mr Lath pointed out that the Finance Minister, Mr P. Chidambaram, had brought down the excise duty for a wide range of products. Effectively, most of the products in chapter 48 of the Excise Act are in a lower bracket except for the corrugated boxes, which continue in the 16 per cent range.

(This article was published in the Business Line print edition dated March 4, 2006)
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