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Fringe benefit tax on exporters must go
May, 20th 2009

The commerce department has asked for the removal of fringe benefit tax on exporters in its list of key reform proposals to be included in an ambitious package being readied by officials for the new government's 100-day reform agenda.

It has asked for removal of this tax imposed on exporters as it acts as a disincentive for them to travel to look for new buyers and participate in business fairs. With Indian exports taking a severe beating in the past six months, the stress is expected be on reducing operation costs of exporters.

The previous government had been considering removing fringe benefit tax on exporters, and the new one is expected to act on it the commerce department has also called for social security scheme for plantation workers who work in harsh conditions.

Implementation of the two free trade agreements, one with the ten-member ASEAN and the other with South Korea, which are ready to be signed is also high on the department s agenda.

Other issues like extension of tax benefits given to 100% export oriented units (EOUs) and Software Technology Parks of India beyond March 31 2010 and extending interest rate subvention or discount given to certain sectors, is also being pushed by the commerce department, but these are likely to be considered for the full budget.

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