The tyre industry has asked the government to fix the import duty on raw materials at a rate which is 10 per cent lower than the import duty on the end-product (tyres) along with exclusion of tyres from the concessional rate of import duty under the Bangkok Agreement. It has also asked for lowering of import duty on natural rubber from 25 per cent to 10 per cent.
The industry has also demanded a reduction in the excise duty on tyres, especially for commercial vehicles as the extent of taxation on tyres is very high.
In its pre-budget memorandum, Raghupati Singhania, chairman of the Automotive Tyre Manufacturers Association (ATMA) said that the anomalies in import duty rates on raw materials are putting a major financial burden on the industry.
Saying that the Raja Chellaiah Committee had recommended that the lowest rate of import tariff should be on feedstock, slightly higher tariff for intermediaries, raw materials and highest rate for finished products to encourage value-addition in the country, ATMA added with 70 per cent of the cost of production of tyres accounted by the raw materials, tyre industry is essentially a raw material-based industry.
The tyre industry has also asked for complete waiver of import duty on steel and polyester tyre cord and reduction in import duty on butyl rubber from 35 per cent to 10 per cent.
On the demand of exclusion of tyres from the concessional rate of import duty under the Bangkok Agreement, ATMA said
