CMA calls for a reduction in excise duty, India

Ahead of the government’s forthcoming Budget, the Cement Manufacturers Association of India has called for a reduction in the current excise duty on cement to bring it more in line with other core industries. It has also requested a revision to duties on imports of cement and on raw materials for cement production.

The Economic Times of India published a statement by the CMA stating: “To encourage the cement industry and to bring it at par with other core infrastructure industries, the excise duty rate [should] be rationalized from 12 per cent to 6-8 per cent,” the CMA said in a Budget memorandum to India’s finance ministry.

The CMA highlighted that excise duty rates on cement are one of the highest and next only to luxury goods like cars. Tax on cement continues to be the highest among items required for building infrastructure. “Other core industries attract around a five per cent duty. Therefore, for growth of the cement industry, the government may kindly reduce excise duty on cement and clinker,” it added.

The CMA has also called for levying basic customs duty on the imports of cement or alternatively, import duties on goods required for manufacture of cement be abolished.  At present, import of cement into India is freely allowed without a basic customs duty. However, all major inputs for manufacturing cement such as limestone, gypsum, petcoke, etc, have a customs duty.

"Therefore, it is requested to provide a level-playing field, basic customs duty be levied on cement imports into India. Alternatively, import duties on goods required for manufacture of cement be abolished and freely allowed without levy of duty," the CMA said.