Displaying items by tag: Tax

Vietnam: The Vietnam Cement Association (VNCA) has urged the government to address the cement industry's challenges, following a continuous decline in sales since 2022. Despite having 61 cement plants with a combined capacity of 117Mt/yr, the industry recorded sales of only 87.8Mt/yr in 2023, marking a 16% year-on-year fall in domestic consumption to 56.6Mt and a 1% decline in exports to 31.2Mt. The downturn in both domestic and export markets has resulted in excess inventory, leading many plants to reduce capacity or halt operations, with some facing bankruptcy or the risk of foreign acquisition.

Several factors have contributed to the industry's difficulties, including reduced domestic demand due to reliance on traditional construction techniques in major infrastructure projects, a stagnant real estate market, escalating fuel costs, and increased export taxes on clinker. To combat these issues, VNCA proposes promoting concrete use in high-speed infrastructure projects, especially in the Central region and the Mekong Delta. It also advocates maintaining or eliminating export taxes on clinker for the next two years and providing VAT exemptions. Additionally, VNCA calls for financial support, requesting banks to offer debt relief and reduced interest rates to cement companies. The association also advises against further foreign investment in Vietnam's cement sector.

North America: A new coalition for the scaling and deployment of low-carbon building materials, the creation of new clean cement and concrete jobs and the promotion of environmental justice launched earlier in January 2024. Called the Decarbonized Cement and Concrete Alliance (DC2), it comprises alternative cement developers Biomason, Brimstone, Chement, Fortera and Terra CO₂, sequestration company Blue Planet Systems, circular concrete producer CarbonBuilt, biogenic limestone producer Minus Materials, hydrothermal processing technology developer Queens Carbon and electrified cement production technology developer Sublime Systems. DC2’s areas of engagement in policy will include tax credits, standards, ecolabeling and subsidisation, in line with the US Department of Energy’s Pathways to Commercial Liftoff: Low-Carbon Cement strategy.

CarbonBuilt’s government and community affairs manager Sal Brzozowski said “DC2’s platform of robust policy, standards and incentives to scale innovative solutions will not only accelerate deep decarbonisation, but also transform the concrete industry from one of the world’s largest CO₂ emitters to one of the world’s largest carbon sinks.”

Uzbekistan: The government has reduced the tax on limestone for use as a raw material in cement production. Uzbekistan Newsline has reported that the tax rate has dropped by 73% to US$0.48/t.

India: The government’s Income Tax Department fined Shree Cement US$481m on 5 January 2024. The fine is for the company’s use of falsified bills in relation to a non-existent waste management plant to claim US$1.02bn-worth of tax deductions between April 2014 and March 2023.

The Economic Times newspaper, breaking the story, reported that neither Shree Cement nor the Income Tax Department has yet issued a statement.

India: The Office of the Deputy Commissioner of Income Tax, Kanpur, Uttar Pradesh, has issued a show cause notice to JK Cement with regard to possible short payments, non-payments or erroneous refunds, including associated interest, worth US$279,000.

Reuters has reported that the company expects ‘no material impact’ on its operational, financial or other activities due to the notice.

India: UltraTech Cement says that it has received demand orders from two local revenue authorities for issues relating to its past tax payments. The Financial Express Online newspaper has reported that the producer must pay a total of US$86,600, including interest and fines. Office of the Deputy Commissioner of State Tax, Bhavnagar, Gujarat, demanded US$56,400 due to an allegedly ineligible input tax credit. Meanwhile, the Office of the Assistant Commissioner of Central Goods and Service Tax Division II, Punjab, demanded US$30,200 due to input service distributor credit not reflected in its statement for the 2018 financial year.

UltraTech Cement plans to challenge the orders, to wit the company said that it has a ‘good case on merit’ to present before appellate authorities.

Vietnam: Vietnam sold 89Mt of cement and clinker in 2023, down by 6% year-on-year from 2022 levels. Việt Nam News has reported that exports fell less sharply than domestic sales. The country exported 32.6Mt of cement and clinker, down by 2% year-on-year from 2022.

The Ministry of Construction is reportedly contemplating extending a 2% reduction in the rate of value-added tax (VAT) on cement in order to stimulate sales. Additionally, it has called for a reduction in the export tax on clinker back down to 5%, following a rise to 10% in 2023.

UK: The Mineral Products Association (MPA) has welcomed government plans for the implementation of a UK carbon border adjustment mechanism for cement by 2027. The association urged the government to develop policy and business models for carbon capture, use and storage, including supporting a domestic carbon neutral and negative products sector.

MPA executive director for energy and climate change Diana Casey said “We cannot take our supply of cement for granted and neither can we put ourselves at risk of unstable international trading markets. That is why today’s commitment to a UK CBAM is so important. Levelling the carbon cost between domestic production and imports will help the UK attract the investment required to decarbonise and ensure our long-term security of supply. The Government’s commitment to bring in the UK CBAM by 2027 is very welcome, and ideally it should be introduced in 2026 to align with the EU scheme. This is the only way to prevent any detrimental impact of the EU CBAM on UK industry.” She added “As well as a CBAM on cement, the MPA would be interested in exploring a CBAM on lime. However, the challenge for the lime sector is ensuring that lime exports can compete in international markets.”

Canada: The Cement Association of Canada (CAC) says that provisions for investments and supportive measures in the government’s Fall Economic Statement 2023 will help to ensure the successful roll-out of carbon capture, utilisation and storage (CCUS) for industrial decarbonisation. The statement commits the government to advancing a CCUS Investment Tax Credits (ITC) scheme.

CAC president and CEO Adam Auer said “We commend the government’s recognition of the importance of CCUS in achieving our climate objectives. The cement industry is committed to reducing its carbon footprint, and these investments will facilitate the deployment of innovative technologies that are essential for achieving our Concrete Zero sustainability action plan objectives.”

Australia: The government has begun consultations with affected parties over the possible implementation of a carbon border tax on imports of goods from heavy industries, including cement production. The Herald Sun newspaper has reported that manufacturers’ associations in Australia have welcomed the possible change to emissions laws.