Exporters' body FIEO Wednesday urged the Centre to exempt exporters from payment of Service Tax on the export related services.

Speaking at Post Budget Interactive Session organized by the Federation of Indian Export Organisations, Director General of the industry chamber Ajay Sahai urged the government to bring the export related services like Commission to Foreign Agents and Movement of Containers to Port, among others, into the negative list so that exporters are exempted from payment of Service Tax.

Addressing the event, Central Board of Excise and Customs (CBEC) S K Goel said that the recent Budget proposals to increase duties and bring more goods and services under the ambit of tax net have been taken keeping in mind the tax GDP ratio that went down from 4.45% last year to 3.8% this year.

Mentioning that in 2009, excise duties were reduced from a peak of 14% to 8% to give a stimulus to the industry struggling in the recession, and in the last year budget, excise duties were increased to 10% and then to 12% this year, he appealed the industry to gradually adjust with this scenario by the time GST is implemented.

When GST will be implemented, which has already been endorsed by the Empowered Committee of State Finance Ministers, large number of tax issues will get resolved automatically, he said.

During the interaction, Sahai urged the CBEC official to look into the issue of charging duty on iron ore on Dry Metric Ton (DMT) basis. He stated that a recent clarification regarding assessment of iron ore for charging of export duty issued earlier by the board appears to be ambiguous.

Speaking on the occasion, FIEO member Ashok Jain viewed that the Centre should support exporters in the present difficult situation arising due to Eurozone crisis by rolling back the excise duty on handmade carpets and realizing the legitimate benefits of exporters in time.

Earlier welcoming Goel, FIEO past president Navratan Samdria said that Rule 14 of Cenvat Credit Rules is a bold step in the right direction. He said that fiscal consolidation is the focus of the budget.

He added that introduction of the negative list of services for service tax purpose is a welcome step which reduces the confusion and complemented CBEC for bringing common simplified registration form and common return form for both excise and service tax.