New Delhi, Oct 31 (UNI) The government today abolished customs duty of five per cent on Aviation Turbine Fuel (ATF) and withdrew export duty on certain items like pig iron and iron and steel ingots in view of the steep fall in international prices of these items.
The other items on which export duty has been withdrawn include bars and rods, angles shapes and sections.
However, scrap would continue to attract the existing rate of export duty.
Export duty was imposed on specified iron and steel products in May, 2008 which were modified in June, 2008.
"Considering the steep fall in the international prices recently, Government have decided to withdraw the export duty on certain items such as pig iron, iron and steel ingots, bars and rods, angles, shapes, sections," an official release said here.
Export duty of 15 per cent ad valorem was imposed on iron ore (lumps and fines) in June, 2008. The international price of fines has gone down substantially making their exports unremunerative.
"With a view to improve the export competitiveness of the mining industry, and for protecting the interest of the employees engaged in this sector, the 15 per cent ad valorem export duty on fines has been replaced with a specific duty of Rs.200 per tonne. The rate of export duty on iron ore lumps continues to remain unchanged", the release said.
The release said aviation sector is experiencing financial stress, which is partly due to high price of Aviation Turbine Fuel (ATF).
In order to give relief to this sector, the basic customs duty of five per cent has been abolished. Though there are no imports of ATF and it is a freely priced petroleum product, the price of domestically produced ATF is based on import parity price factoring in the basic customs duty.
"The exemption would result in lowering of the base price of ATF and, consequently, lowering the incidence of excise duty and VAT, giving substantial relief to the aviation sector", the release said.
In order to provide the required protection to domestic ferro-molybdenum and ferro-vanadium industry, the full exemption from basic customs duty has also been withdrawn. These items will now attract basic customs duty of 5 per cent. .
The duty changes will be effective from today.
UNI GS MP AS2114