The Government of India is mulling to introduce a COVID-19 tax levy of 15 per cent on all chemical and petrochemical imports from 1 May 2020 to 31 March 2021, reports Economic Times.
The said levy would also apply on all preferential imports under various Free Trade Agreements (FTAs) which India is a signatory to. It would cover imports of organic chemicals, inorganic chemicals, plastics, rubber, man-made filaments and man-made staple fibres.
It should be noted that between April 2019 and January 2020 alone, India imported chemical and petrochemical products worth a whopping $86.82 billion. Almost 14 per cent of these inwards shipments came from China alone.
The proposal is presently undergoing stakeholder consultations led by the Department of Chemicals and Petrochemicals. While certain sections of the industry have endorsed the proposal, many others who are dependent on imported chemicals, raw materials or intermediate goods have opposed it.
It is feared that imposition of such a levy on imports could inspire other countries to impose such levies on Indian exports, which could be a major setback for the domestic industries.
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