New Delhi, 22/01/2025: Assocham, an industry group, has asked the government to remove the coal cess in the upcoming Union Budget 2025, saying that it is harming power-intensive industries, especially aluminium production. The coal cess, which started at Rs 50 per metric tonne in 2010, has increased over the years to Rs 400 per metric tonne, making it more expensive for industries that rely on coal.
The coal cess, which has increased from Rs 50 per metric tonne in 2010 to Rs 400 per metric tonne in the 2016-17 Union Budget, has significantly driven up the production costs for industries reliant on coal. Assocham pointed out that coal now contributes 32 percent to the production cost of aluminium, making it increasingly expensive for domestic producers to stay competitive.
The industry body’s memorandum highlighted that the escalating cess has hurt the aluminium sector’s sustainability, noting that high power costs are a critical challenge. Assocham’s plea for the cess removal is supported by a recent NITI Aayog report, which highlighted the competitive disadvantage of domestic aluminium producers compared to global rivals.
As Union Finance Minister Nirmala Sitharaman prepares to present the Union Budget 2025 on 1 February, Assocham’s proposal seeks to address these growing concerns and ease the financial strain on power-intensive industries.
