A GST rate of 18% on the import of aluminium scraps is having adverse effects on a wide spectrum of small and medium scale industries. Moreover, no refund provision on input has brought the Aluminum recycling industry on its knees.
As stated by the President of the All India Non-Ferrous Metal Exim Association (ANMA), the overvaluation of aluminium scrap by the Customs Department has put the extra burden on the aluminium recycling industry. The industry is primarily dependent on the import of metal scraps. Gujrat alone accounts for 40% of the industries output. Nearly 5,000 micro, small and medium enterprises are associated with this industry. The association has demanded a reduction in the present GST rate on aluminium scrap import from 18% to five percent.
Kishore Rajpurohit, a former head of the association, said, “Customs should be assessed on the transaction value under section 14 of Customs Law, 1962. This industry is facing double taxation by imposing GST on imports and intermediary services. This has had a bad effect on the industry. ”
Read Also: Why Steel Industry Thinks It is Doing Samaj Seva after GST?
The reduction in GST would have no effect on the final tax revenue. The GST would be levied on finished products. However, the reduction will surely help to save the industry as well as thousands of families dependent on the industry for their livelihood. The negligence by the Government might have a severe impact on many small enterprises related to aluminium recycling. About 1.5 lakh people are employed in this industry, of whom 30 percent are women. Innocent daily wage earners may even be subjected to debt traps by others.
