Cement prices set to go up with hike in taxes

With a hike in the certain goods carried by road (CGCR) tax and the electricity duty on cement, its price is all set to increase by Rs 5 to 10 per bag in the coming days.

Though major cement companies, including Adani and UltraTech, had not effected any hike in the cement price after the electricity duty was increased from 17 per cent to 25 per cent recently, the hike in CGCR tax has compelled them to re-think on the issue.

The CGCR tax has been increased from Rs 7.50 per 50 kg bag to Rs 11 per 50 kg bag as per a notification issued on September 16.

Despite the introduction of goods and services tax (GST) nationally from July 2017, the state continues to charge this levy as it was not subsumed in the central tax.

An official of Adani Group, which runs Ambuja Cements Limited at Darlaghat and Nalagarh, besides an ACC plant at Barmana, said, “The company had decided against implementing any hike in the cement prices earlier. However, the latest move of the state government to increase the electricity duty and CGCR has compelled us to re-work the cement price.”

“At a time when disaster-hit people are planning to begin repairs, this hike has come as a rude shock for them. A bag of cement costs Rs 450-465 in the state,” he added.

Gagan Kapoor, Chairman, Confederation of Indian Industry, Himachal, said, “The increase in CGCR and electricity duty on cement has broken the backbone of the industry.”

“With the road and civic infrastructure yet to be restored, the transportation of goods was already a challenge and this fresh blow will further hit the industry as well as employment generation,” Kapoor added