Union Budget 2012-13: Cement manufacturers announces price hikes between Rs 7-10 per bag

Cement manufacturers have lost no time in announcing price hikes between Rs 7 and Rs 10 for a 50kg bag. The price of a 50kg bag of cement ranges between Rs 280 and Rs 300. The changes will come into effect from Saturday.

Makers said the altering of methodology to levy excise duties on cement plus an increase in base excise duty rate from 10% to 12% necessitated the increase. The cement industry was taxed at 10% on invoice price earlier.

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According to the new method, excise duty would be calculated on the maximum retail price. Consequentially , the increase in retail prices will be directly proportional to the MRP. The FM, however, lowered excise duties to mini cement plants, but not many of them are operational.

“Prices will rise by Rs 7 to Rs 8 per bag in South India ,” A V Dharmakrishnan, executive director, Madras Cements, said. In markets where the retail prices are higher, the increase in prices will be more than that.