Rubber industry calls for scrapping cess on import of rubber

KOCHI: With rubber industry depending more on import of natural rubber as the international prices go down and supply becomes tight in the local market, there has been renewed concern on imposition of cess. The industry has demanded discontinuation of cess being levied on import of natural rubber.

According to All India Rubber Industries Association (AIRIA), cess is leviable only on rubber produced in India under the Rubber Act and excludes imported rubber from the purview of the said Act. AIRIA has already sought clarifications on the issue from the Rubber Board. In its communication, Rubber Board has concurred that under the Rubber Act, only the rubber produced in India attracts cess and that Rubber Board is the designated authority to collect the same.

The notification issued by the Ministry of Commerce regarding imposition of new rubber cess dated 29th August 2011 also talks about levying of cess on rubber produced in India only, said an AIRIA press statement.

“In view of widening gap between domestic NR production and consumption, import of NR in significant amount is inevitable. According to Rubber Board figures, the gap between domestic production and consumption widened to 133400 tonnes in the just concluded year 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 Mr Niraj Thakkar, president AIRIA.