Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: list of goods taxed at 4% :: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: articles on VAT and GST in India :: due date for vat payment :: cpt :: TAX RATES - GOODS TAXABLE @ 4% :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TDS :: VAT RATES :: ACCOUNTING STANDARDS :: VAT Audit :: ACCOUNTING STANDARD :: form 3cd :: empanelment
 
 
« News Headlines »
 Invoking Writ Jurisdiction For Income Tax Matters
 How to file income-tax returns online
 How Income Tax Returns Are Scrutinised
 All About New Income Disclosure Scheme to make Demonetisation successful
 Your deposit may draw income tax notice
 Accepting payment under IDS 2016
 New disclosure scheme could see 50% tax and 4-year limit on cash use for unaccounted deposits
 Pay 50% tax on unaccounted deposits, or 85% if caught, says Modi government
 Deadline to pay property tax in old currency extended
 Cabinet clears amendments to Income Tax Act
 Have you got interest on your income tax refund?

Tax code: Commerce department
October, 06th 2009

The new draft direct tax code that seeks to simplify and rationalise the countrys direct tax structure has come under fire from the commerce department for its suggestions on doing away with exemptions for special economic zones (SEZs).

The department has taken up the issue with the finance ministry, pointing out that removing exemptions would render the SEZ Act ineffective, a commerce department official has said.

We have started official consultations with the revenue department on the issue of the proposed withdrawal of exemptions for SEZs. We feel that removal of exemption would shake investor confidence in India and affect flow of investments into SEZs, the official said.

Under the SEZ Act, developers are entitled to 100% tax exemption on profits for ten years in a block for the first fifteen years of operation. SEZ units are entitled to 100% tax exemption on export profits in the first five years of operations. They are eligible for 50% exemption on export profits for the next five years while for the following five years, units get up to 50% exemption on reinvested profits.

Under the proposed direct tax code, SEZ developers would be allowed to only recover capital and revenue expenditure (except expenditure on land) and would be liable to income tax on profits made thereafter.

This means that the new direct tax code, if implemented in its present form, will lead to a total switchover from profit-linked incentives. This is contrary to the provisions of the SEZ Act, LB Singhal, director-general, export promotion council for EoUs and SEZs, told ET.

In the case of SEZ units too, profit-linked incentives would be substituted by a new scheme. All this has created a lot of uncertainty. Our council gets several queries every day from developers, units and international investors seeking clarification on the future of the SEZ policy, Mr Singhal added.

The commerce department official pointed out that the department had pointed out to the finance ministry that SEZs in the country had started doing well only after the SEZ Act was put in place in 2005 and the rules were spelt out in February 2006.

While investments just trickled in the first five years since the SEZ scheme was introduced in 2005, there was a surge in investments only when the act was implemented. SEZs have attracted of Rs 1,00,000 crore in investments so far and have led to the employment of several lakhs of workers, the official said.

The draft direct tax code put in place by the revenue department is being discussed extensively by various departments and ministries of the government and the industry. The finance ministry will hold a meeting with major industry chambers on October 9th to get their inputs on the draft.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - We Bring IT. Offshore software outsourcing company. We use Global Delivery Model (GDM) and believe in Follow The Sun principle

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions