Government announced fresh excise duty concessions on cement, whose rising prices had become a cause for concern, even as Finance Minister P Chidmabaram declined to entertain requests for more sops on personal income and corporate taxes.
He identified inflation, reigning at about six per cent, as a major worry where government would intensify fiscal and monetary measures to bring down the rate of price rise to 4.5 per cent.
Chidambaram was replying to the debate on the Finance Bill in Lok Sabha.
Admitting that dual excise duty structure proposed in the Budget 2007-08 did not draw positive response from cement players, Chidambaram revised the structure.
While those selling cement at a price below Rs 190 for a 50 kg bag would continue to enjoy the reduced duty of Rs 350 per tonne, those selling at a higher rate would have to shell out 12 per cent of retail selling price as excise duty against Rs 600 per tonne proposed in the Budget.
As such, those selling at above Rs 190 a bag would pay ad valorem duty instead of specific duty. This would result in a reduction of prices by Rs seven per bag, Chidambaram said.
In response to the demand by the industry, the Finance Minister also modified export duty on iron ores, proposed in the Budget. He reduced export duty on iron ore fines with less than 62 per cent fe content to Rs 50 per tonne from Rs 300.
However, export duty on iron ore fines with fe content of more than 62 per cent and flakes would remain at Rs 300 per tonne.