The government today cut the excise duty on key intermediates for synthetic fibre, including paraxylene, Dimethyl terephthalate (DMT), pure terephthalic acid (PAT), polyester chips, and acrylonitrile from 16 per cent to eight per cent, and on mono ethlyne glycol (MEG) from 16 per cent to 12 per cent. This year's Budget had reduced the excise duty on synthetic fibre to eight per cent, while retaining the duty on intermediates at 16 per cent, As a result, companies could claim input credit of 16 per cent, but offset it only against the eight-per-cent duty on fibre.
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