Withdraw cess on imported rubber

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Terming it as illegal, the rubber industry has sought immediate withdrawal of cess on natural rubber imported into the country. They have asked both the ministry of finance and ministry commerce to issue necessary instructions to release natural rubber consignments without insisting on payment of rubber cess.

According to All India Rubber Industries Association (AIRIA), the customs department has been levying a cess of Rs 2 per kg on imported rubber.

The cess is levied only on rubber produced in the country under the Rubber Act and excludes imported rubber. No such notification as to the levy of the cess as an additional duty under Customs Tariff Act has been issued. Also there are no provisions in foreign trade policy regarding levy of rubber cess on imported rubber, AIRIA said.

“Levy and collection of cess on rubber is governed under section 12 of the Rubber Act 1947, according to which the said cess is charged on rubber produced and that the rubber board is the designated authority to collect it,” the board said.

The notification issued on August 29, 2011 by the ministry of commerce regarding imposition of new rubber cess also talks about levying of cess on rubber produced in India only. “The central government hereby appoints September 1, 2011, as the date from which the duty of excise at the rate of Rs two per kg of rubber shall be levied as cess on all rubber produced in India”, said the notification.

“In view of widening gap between domestic NR production and consumption, import of natural rubber in significant amount is inevitable. According to figures, the gap between production and consumption widened to 1,33,400 tonnes in 2013-14. While we have been asking for duty free NR import to the extent of domestic deficit, any cess on import of rubber will be counterproductive and affect the competitiveness of the rubber sector”, said AIRIA president.

sangeethag@mydigitalfc.com

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