Customs, Excise Norms Must Match: Chamber

The Associated Chambers of Commerce and Industry of India (Assocham) has urged the Central Board of Excise and Customs (CBEC) to remove the anomaly arising out of different valuation norms for indigenously manufactured goods and imported finished retail packs.

"Goods manufactured in India are subject to excise duty on maximum retail price (MRP) basis under Section 4A. However, identical goods when imported in finished retail packs ready for sale in India attract the additional duty on the basis of invoice value (transaction value)," Assocham said in a communication to the CBEC chairman.

Therefore, imported goods are subject to a substantially lower additional duty vis-a-vis the excise duty that is levied on locally manufactured goods. "This puts the local manufacturing units at a huge disadvantage and results in an enormous loss of revenue to the exchequer," an Assocham statement issued here yesterday said.

 

This system of assessment, according to the chamber, will adversely affect the Indian industry and "thousands of workers employed in such units", it said.

CII has said importers should file a declaration that these are finished products intended for sale in the retail market.

"The importer should declare the MRP of the products on the bill of entry," the statement said, adding that the additional duty should be levied "equal to the excise duty levied on Indian products" for the time being.

If the article is not produced in India, then the amount of excise duty leviable on the class of articles to which the imported article belong should be applicable.

The chamber said: "The tariff policy should encourage growth and diversification of the domestic industry." At present, the domestic industry is facing major cost disadvantages which are beyond its control. These include high interest rates, regular increase in the cost of inputs and raw materials, high cost of power, inadequate infrastructure, high incidence of domestic taxes. "These anomalies would be compounded in the post-quantitative restrictions regime when tariffs must provide a level-playing field."