On the other hand, the removal of eight per cent excise duty on packet tea has been welcomed. In fact, the Federation of All India Tea Traders' Associations (FAITTA) and Tea Packeteers Association of India has hailed the abolition.

On the other hand, ITA chairman VK Goenka observed in no uncertain terms that the reimposition of the central excise duty at Rs 2 per kg on bulk tea after a gap of eight years is "totally inconsistent with the principle adopted by the finance minister while totally exempting packaged tea..." He felt that the "levy on bulk tea is a direct charge on a product which remains the cheapest mass consumption beverage for the entire Indian population".

A press release issued by the association said that, though the removal ofeight per cent was laudable. Faitta chairman PO Desai in a faxed message, congratulated Sinha for taking due note of the association's several memorandums. He pointed out that the sales of packet tea which had shown a 8.3 per cent fall in sales between July and December 1998.

The imposition of 10 per cent surcharge on income tax will complicate matters in addition to leading to a higher incidence of taxation. Increase in postal rates will in turn hike the cost of tea sampling between 35 and 50 per cent. Also the increase in diesel cost will add on to the landed price of tea across the country.