May 7, 2003	Wednesday	Rabi-ul-Awwal 4, 1424

ISLAMABAD, May 6: The central excise duty (CED) collection from beverages has witnessed a fall by more than 16 per cent in three quarters.

Official sources told Dawn on Monday that the CED collection from Beverages — used to one of the big revenue spinner —decreased at the rate of 16.3 per cent in the first quarter, 12.7 per cent in the second quarter and 18.4 per cent in the third quarter.

The main reason for the decline was reduction in the rate of duty from 15 per cent to 12 per cent in the last year budget with the aim that the beverages manufacturers would decrease the price of the commodity.

According to the officials, despite all the concessions in duty, the clearance of beverages registered a decrease of 15 per cent during the same period under review, which resulted in raising of less revenue from the commodity.

Incidentally, the CED revenue from concentrates of beverages has increased in the third quarter by 28.7 per cent, indicating that the manufacturers are anticipating a revival of demand for beverages in the summer season.

According to the statistics compiled by the CBR, the CED collection from POL products has also declined by 27.4 per cent due to transfer of most of the POL items to customs duty net.

The analysis of the four other CED major revenue spinners showed that the collection from cigarettes reflected an increase of 5.1 per cent during the three quarters.

The increase in the collection would be attributed to a combination of price and duty increases in the last year budget and anecdotal evidence of heightened anti-smuggling activities, claimed the officials.

The impact of the budgetary measures seemed to have overwhelmed the overall decline in production and clearance of cigarettes during the period under review.

The CED collection from cement increased by 17.5 per cent during the three quarters of current financial year over the same period of last year. While the breaking down of cartel of cement manufacturers resulted in reduction of prices of cement, but it is the CED structure that has resulted into a healthy growth in collection.

This observation was further confirmed by 18.3 per cent and 11.4 per cent growth in production and clearance of cement, respectively during the period under review, claimed the officials.

The gross and net collection of CED during the first three quarters entails a negligible growth of 0.3 per cent over the corresponding period of last year.