Exporters seek IT exemption for three years from new govt
May, 18th 2009
Knitwear garment exporters today said that they should be exempted from the purview of income tax by the new Government coming up at the Centre for three years, so that it would help to reduce the prices and the 'competitiveness' could be increased.
Welcoming the results of the Lok Sabha polls, Tirupur Exporters' Association (TEA) president A Shaktivel said in a statement that knitwear exporters have been facing crises in the export market and they were efforts to cut down the costs to sustain in the global market.
He said TEA wanted a level playing field to compete with China, Vietnam and Bangla Desh, since they have increased the refund of VAT by 15 per cent to 17 per cent, as one of the supporting measures to exporters, to bail out from global crisis.
By taking into consideration of this, Duty Drawback rates and Duty Entitlement Pass Book have to be increased by five per cent, he said.
Stating that exporters were working on thin margins and taxation of the profit left them with no oney for modernisation and expansion of manufaturing, Shaktivel said IT exemption has to be given for three years to increase competitiveness.
The exporters should also be exempted from Fringe Benefit Tax, he said.
In view of enormous delay in getting refund of service tax and paper work involved in making application for refund, the Government should give exemption from service tax, TEA said.
As the interest rate was higher in India compared to the competitors, export credit should be given at seven per cent across the board without linking it with the PLR. However, in the meantime interest subvention scheme should be continued till March 31, 2012, Shaktivel said.
An Export Development Fund should be created for MSME exporters with a minium corpus of Rs 5,000 crore, as diversification of exports has become all the more important particularly for traditional sectors of exports, he said.
Existing scheme of Focus Market Scheme, Focus Product scheme and Market linked Focus scheme should be extended for three years for knitwear garments so that exporters could undertake countrywise diversification strategy to boost India's exports, he said.
The government should provide diesel at international price to units/apparel park set up with the help of Government of india having captive power plant or using their own generators for exports production as power cost constituted an important component of total cost, Shaktivel said.
The exporters have also appealed to implement the Marine discharge project for dyeing units in textile belt in Tamil Nadu, as promised in the DMK manifesto, Shaktivel said.