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Restore parity in duties on cotton yarn for DTA, EOUS: PHDCCI
The industry body PHDCCI has asked the government to restore parity in the
duty structure for 100 per cent export oriented units (EOU) and domestic tariff
area (DTA) units for cotton yarn and woven fabrics.
“In 2003-04, duties payable by 100 per cent EOUs for cotton fabrics were
at par with DTA units. But in this year’s budget, the cotton textile chain
has been given an option of paying zero duty. This option has not been made
available to the EOUs resulting in anomaly in the duty structure,” the
chamber said in a release here.
This disparity would adversely affect the export competitiveness of the EOUs
which were earlier allowed to sell 50 per cent of FOB value of exports in the
DTA, it said.
Further, goods produced in a 100 per cent EOU and cleared by the unit in DTA
attracted duties equivalent to the duty as applicable to the DTA units. Duties
payable before this year’s budget included an additional duty at 15 per
cent of basic duty. The budget has imposed a two per cent education cess. This
would put the EOUs to disadvantage compared to the DTA units, the chamber said.
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