The Central Board of Revenue (CBR) has given a facility to adjust central excise duty (CED) paid on the un-manufactured tobacco used in the cigarettes production.
The CBR has directed all regional collectors that the central excise duty (CED) paid on un-manufactured tobacco has been made adjustable against the excise duty payable on cigarettes manufactured therefrom. In this regard, a procedure laid down in Central Excise General Order 2 of 2003 would be followed.
Sources said that the un-manufactured tobacco is specially processed for use in cigarettes.
They said that the condition of obtaining central excise licence by the ghee/cooking oil manufacturers has been abolished in the budget. The manufacturers or producers of vegetable ghee and cooking oil paying excise duty under the third proviso to sub-section (1) of Section 3 of the Central Excise Act, 1944, are not required to obtain central excise licence. Necessary provision in Rule 174 has been inserted through SRO 504 (I)/2004.
When asked why central excise duty on soap was not abolished despite a budget proposal, the sources said that the policy makers rejected the proposal on the ground that withdrawal of excise duty on soap and detergents would cause an annual loss of Rs 2.5 billion to the national exchequer.
The impact of withdrawing duty on paints and varnishes is around Rs 500 million, whereas the revenue loss due to CED exemption to syrups, squashes and juices comes to Rs 350 million.
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