Budget for the year 2016-17 is mainly focused on rural and agriculture sector with hardly any major announcement for steel industry.
As MIP on steel imports was recently announced by the government, customs duty on long and flat steel is kept unchanged at 10% and 12.5% respectively.
In order to promote exports from country, government has widened duty drawback scheme under which more products and countries will be included.Under the scheme, the government refunds duties on imported inputs for export items.
Key Highlights
1. Clean energy cess on coal increased from INR 200/MT to INR 400/MT
2. Export duty removed on low grade (below Fe 58%) iron ore lump & fines
3. Export duty on high grade iron ore lump and fines remains unchanged at 30%
4. Export duty removed on Chrome ore
5. Export duty on bauxite reduced from 20% to 15%
6. BCD (basic Custom duty) increased on aluminum products from 7.5% to 10%
7. BCD on zinc alloys increased from 5% to 7.5%
8. BCD reduced on brass scrap from 5% to 2.5%
9. BCD unchanged on steel imports
10. Excise duty remains unchanged
Customs Duty Data on various Steel & Steel-related Products
| Item | CH No. | Custom Duty | Custom Duty | Duty w.e.f 16 Jun’15 | Duty w.e.f 12 Aug’15 | Customs Duty | MIP in USD/MT |
| FY 15 | FY 16 | FY 17 | |||||
| Pig iron | 72.01 | 5.00% | 5.00% | 5.00% | 5.00% | 5.00% | – |
| Semis | 72.07 | 5.00% | 5.00% | 7.50% | 10.00% | 10.00% | 341-362 |
| Bars & Rods | 72.13 | 5.00% | 5.00% | 7.50% | 10.00% | 10.00% | 449-455 |
| Structurals | 72.16 | 5.00% | 5.00% | 7.50% | 10.00% | 10.00% | – |
| HR Sheets/Plates(Non Alloy) | 72.11 | 7.50% | 7.50% | 10.00% | 12.50% | 12.50% | 500 |
| HR Coils (Non Alloy) | 72.08 | 7.50% | 7.50% | 10.00% | 12.50% | 12.50% | 445 |
| CR Coils/Sheets (Non Alloy) | 72.09 | 7.50% | 7.50% | 10.00% | 12.50% | 12.50% | 560 |
| GP/GC Sheets (Non Alloy) | 72.10 | 7.50% | 7.50% | 10.00% | 12.50% | 12.50% | 643-752 |
| HR/CR Alloy Steel(Flat rolled) other than items of Headings No. 72253090, 72254019, 722550 and 72259900 |
– | 5.00% | 5.00% | 7.50% | 10.00% | 10.00% | – |
| Flat Rolled Alloy products of Alloy products of heading 72253090,72254019, 7225550 and 72259900 |
7.50% | 7.50% | 7.50% | 7.50% | 7.50% | 445-752 | |
| Tinplates W/W and TFS seconds | 72.10, 72.12 | 10.00% | 10.00% | 10.00% | 12.50% | 12.50% | – |
| Defectives CR/coils | 72.09 | 10.00% | 10.00% | 10.00% | 12.50% | 12.50% | 560 |
| Stainless steel HR coils for coin blanks | 72.19 | 7.50% | 7.50% | 7.50% | 7.50% | 7.50% | – |
| Melting scrap (iron, steel & stainless steel) | 72.04 | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Re-rollable scrap | 72.07 | 2.50% | 2.50% | 7.50% | 10.00% | 10.00% | – |
| Iron ore | 26.01 | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Iron Pellets | – | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Coking coal of ash content below 12% | 27.01 | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Coking coal of ash content below 12% | – | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Steam Coal | 27.01 | 2.50% | 2.50% | 2.50% | 2.50% | 2.50% | – |
| Metcoke | 27.04 | 2.50% | 5.00% | 5.00% | 5.00% | 5.00% | – |
MIP w.e.f 5 Feb’16 till 4 Aug’16
Source: SteelMint Research
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