The Indian Chemical Council (ICC) has called for correction in the inverted duty structure and CENVAT of several items in the forthcoming budget.

In its pre-budget memorandum for 2011-12 to the Department of Chemicals and Petrochemicals (DCPC), the ICC suggested that excise duty on molasses for use in the manufacture of denatured ethyl alcohol (non-potable) be reduced to equivalent of 8 per cent ad valorem or Rs 386/PMT whichever is lower.

It also said that excise duty on Naphtha should be brought down to 10 per cent from 16 and that on Furnace Oil should be reduced from 16 per cent to 10 per cent.

The ICC called for correction in the inverted duty structure on linear alkyl benzene vis-?-vis its raw materials.

The import duty on linear alkyl benzene is 7.5 per cent ad valorem, while the import duty on inputs such as normal paraffin and kerosene is higher at 10 per cent, it said.

It also called for correction in the inverted duty structure on nonyl phenol and dodecyl phenol (@ 7.5 per cent ad valorem) vis-?-vis their raw materials propylene trimer and propylene tetramer (@ 10 per cent ad valorem).

The ICC further suggested reduction in import duty on naphtha to zero level and on oleochemicals to 7.5 per cent ad valorem.

Expressing concern, ICC said that sodium nitrate is being imported in India and attracts zero duty because of its possible use as fertilisers. However, this imported sodium nitrate is never used as fertiliser and finds its way in to industrial use.

So it requested the DCPC to fix the import duty at 7.5 per cent ad valorem.
On precipitated silica, ICC said that the CENVAT rate should be brought down to the lowest level.

"Precipitated silica is manufactured in India with a total capacity of 40,000 TPA. This product is consumed in manufacture of tyres and toothpastes. The small scale manufacturers of toothpastes are not able to avail CENVAT credit, while the CENVAT rate is 10 per cent ad valorem," it said.