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| « Central Sales Tax (CST) reduced to 2% from 1st June, 2008 ... | Govt plans uniform duty structure for liquor... » |
Govt weighs duty on iron ore |
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| June, 02nd 2008 |
The government is believed to have decided to impose 15 per cent export duty on iron ore, used for making steel, which has seen a 50 per cent increase in prices since January, thereby fuelling inflation.
The decision was taken at the meeting of the Committee of Secretaries (CoS) on 30 May, a highly placed source said. The CoS has also decided to roll back export duty on steel, barring primary and semi-finished products, in return for the Rs 4,000 per ton reduction in prices announced by the steel makers early last month.
At present, an export duty at a specific rate of Rs 300 per ton is imposed on iron ore with 62 per cent or higher iron content and Rs 50 per ton on lower grade ore. Under the new dispensation, the export duty would be based on the value of the product shipped abroad.
Decisions on both roll back of export duty on steel and imposition of the same on its raw material are expected to be announced in the next few days. The Department of Revenue will notify the decision once the CoS minutes are issued, an official said.
Steel makers and iron ore producers have been at loggerheads over export of the raw material. Steel makers have been demanding restrictions on raw material export while iron ore producers, helped by a section in the government, had contended that the ore meant for exports was of no use to Indian steel makers.
However, the claim was contested by the steel industry. What is good for China is good for India as well, vice chairman and managing director of JSW Steel Mr Sajjan Jindal said.
The domestic prices of steel have seen a significant increase since 2006-07. Between January and April 2008, price of pig iron went up by more than 70 per cent, construction steel like TMT and wire rods by more than 36 per cent and HR coils by more than 40 per cent.
Rise in raw material prices, strong demand in international and domestic market and increase in global steel prices are some of the reasons cited by the industry for increase in the domestic prices, which have been further impacted by the demand-supply mismatch.
Duty for liquor
Centre is planning to bring about an uniform duty structure for the liquor industry in the country, industry captains said. The Planning Commission has taken the initiative in this regard.
At present, different state governments have different structure for levying duties and taxes on liquor business.
Confederation of Indian Alcoholic Beverage Companies, chairman, Mr Vijay Rekhi, said: The Planning Commission is working on looking at ways and means, as was done in the case of VAT (Value Added Tax), to rationalise fees and duties levied on beverage alcohol at a uniform rate nationwide.
He, however, indicated that it might take time to bring about uniformity in duty structure and said it would call for lot of persuasion.
Meanwhile, the confederation which is now recognised as an apex chamber of Indian alcoholic beverage industry, has announced the formation of a Wine Chapter in the confederation as wine is now among the fastest growing segments in the alcoholic beverage sector owing to changing lifestyles and high disposable incomes.
According to the confederation, sales of wine grew from 0.60 million nine litre cases in 2003 to 1.50 million cases in 2007 recording the second highest growth among the various segments of alcoholic beverage sector.
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