Cement manufactures have proposed the government to abolish central excise duty (CED) on cement. Talking to newsmen, Managing Director, Dadabhoy Cement, Senator Mohammed Amin Dadabhoy, said that they had proposed the government to abolish CED on cement and increase sales tax from 15 percent to 18 percent to overcome losses. He said these measures would increase sale of cement that ultimately would generate more revenue.
Justifying his claim, he said that the CED is an old tax and it had been abolished around the world. Now it is time of sales tax, he added.
He noted that cement manufacturers expanding their production capacity as well as establishing new units to meet the rising demand of cement due to on going construction work in the country as well as its demand in Afghanistan, Iraq, Dubai etc.
He said that cement industries, which were running at 78 percent capacity last year, were now running at 98 percent capacity to meet the increasing demand.
He further stated that most of the cement factories are now running on coal and added that the coal prices are increasing rapidly.
He was of the view that locally produced coal prices have increased from Rs 1,000 per tonne to Rs 1500 per tonne and the imported coal prices have gone up from Rs 3,000 per tonne to Rs 5,000 per tonne.
He hoped that cement production might touch to 34 million tonnes in next three to four years. At present, he said, Pakistan producing around 16 million tonne cement.
He said, in the first seven months of the current fiscal year, Pakistan had exported around 822,000 tonnes cement to Afghanistan. This figure is expected to touch 1,000,000 tonne by the end of June 2005.
He noted that cement is being sold at Rs 235 to Rs 240 per bag. Cement prices were increased in 1999-2000 since then no change has been made in its prices.
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