Indian Finance Minister P. Chidambaram on Thursday scrapped an additional excise tariff on cement sold at a retail price of more than INR190 a bag.
 
"For cement sold for more than INR190 per bag, instead of a specific (excise) rate, we are introducing an ad valorem rate of duty at 12% of the retail sales price," Chidambaram told lawmakers of the lower house of Parliament, while seeking their approval for the current fiscal year’s federal budget. Chidambaram added that this would result in an effective reduction of up to INR7 per bag.
 
In his federal budget speech on Feb. 28, the finance minister had introduced dual excise tariffs on cement, which were opposed by the industry. Local cement companies had to pay an excise tax of INR600 a metric ton if they priced a 50kg bag at more than INR190.
 
"Therefore, after careful consideration it has been decided to replace the dual rate of cement. The concessional specific (excise) duty of INR350 per metric ton for cement sold in retail at not more than INR190 per bag will continue," he said.