A high rate of Goods and Services Tax (GST), with no provision for its refund, threatens to kill the aluminium recycling industry, a majority of which are MSMEs, its representatives said here on Saturday.
“The aluminum recycling industry, which is represented by around 5,000 Micro Small and Medium Enterprises, is severely affected by the accumulation of
GST due to over-valuation of imports of aluminum scrap by the Customs,” said Mahendra Shah, president of the All India Non-Ferrous Metal Exim Association.
The All India Non-Ferrous Metal Exim Association represents the aluminum recycling industry and largely depends on imported metal scrap. Gujarat accounts for around 40 percent of the industry, association members said.
GST on metal scrap at 18 percent is compounding the problem of the industry, he said, adding that the industry has demanded that it be reduced to 5 percent at par with GST on other kinds of scrap.
“Reduction of GST on metal scrap to 5 percent will lead to no accumulation and, at the same time, the government will not incur any revenue loss as it will not affect tax collection. The government would get GST on finished products. Reduction of GST on scrap will help the industry survive,” Shah added.
Kishore Rajpurohit, the past president of the association, said that 20-40 percent extra duty was being paid on the import of aluminum scrap due to the Customs assessment being done on the basis of an alert published by the Directorate General of Valuation.
“The customs duty should instead be assessed at transaction value as per section 14 of the Customs Act, 1962. GST on ocean freight on imports and on intermediary services are acting as double taxation and this is greatly hurting the industry,” Rajpurohit said.
Source: dailypioneer.com