Concor to accept direct payments from exporters
Container Corporation of India (Concor) has agreed to accept direct payments from exporters for inland freight.
By TNN |
NEW DELHI: In a move that comes as a major relief to small exporters, Container Corporation of India (Concor) has agreed to accept direct payments from exporters for inland freight. Till now, exporters were paying inland haulage charges through shipping companies which were charging much higher than the actual payment to Concor. After the issue was taken up by the Delhi Exporters Association (DEA), Concor has issued a public notice to allow exporters to directly deposit inland freight.
Concor's move would lead to lower freight costs for exporters, the Association said. The mark-up being pocketed by shipping companies would be saved now, DEA president S P Agarwal said. We had taken up the issue with Concor and the government to reduce freight costs, he added.
The mark-up was burning a bigger hold in the pocket of exporters due to service tax, Mr Agarwal said. Shipping companies were charging service tax on the entire amount collected by them though only part of it was deposited with Concor for inland freight, he added.
Efforts are now being made to restrict service tax only to the actual amount deposited as freight. The problem has been brought to the notice of Concor which is taking steps to check overcharging of service tax, Mr Agarwal said.
Service tax is applicable only on 30% of rail freight and the remaining 70% is exempt from the levy, Mr Agarwal said. Concor has issued a clarification to this effect after the issue was taken up by DEA. Service tax of 12% and education cess of 2% is applicable on freight charges.
Exporters need to remain competitive in the global market and overcharging should be avoided, the DEA president said. He urged the government to provide cheaper credit and better infrastructure to exporters so that they can compete on a stronger footing to enhance India's share in the global market.
Concor's move would lead to lower freight costs for exporters, the Association said. The mark-up being pocketed by shipping companies would be saved now, DEA president S P Agarwal said. We had taken up the issue with Concor and the government to reduce freight costs, he added.
The mark-up was burning a bigger hold in the pocket of exporters due to service tax, Mr Agarwal said. Shipping companies were charging service tax on the entire amount collected by them though only part of it was deposited with Concor for inland freight, he added.
Efforts are now being made to restrict service tax only to the actual amount deposited as freight. The problem has been brought to the notice of Concor which is taking steps to check overcharging of service tax, Mr Agarwal said.
Service tax is applicable only on 30% of rail freight and the remaining 70% is exempt from the levy, Mr Agarwal said. Concor has issued a clarification to this effect after the issue was taken up by DEA. Service tax of 12% and education cess of 2% is applicable on freight charges.
Exporters need to remain competitive in the global market and overcharging should be avoided, the DEA president said. He urged the government to provide cheaper credit and better infrastructure to exporters so that they can compete on a stronger footing to enhance India's share in the global market.
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