News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
« General »
 Will the rich outsmart the taxman?
 Income tax benefits on NPS explained in 5 points
 Why new tax surcharge has stunned foreign portfolio investors
  How to set-off short-term capital gains?
 Tax receipts growing but not fast enough for new government
 How Modi government's budgets have reduced your income tax burden
 Tax department tightens the noose on offenders
 How to set-off short-term capital gains?
 Government to revamp procedure for tax assessment
 I filed my ITR for AY 2019-20 but made a mistake. How can I rectify it?
 Stricter rules on dealing with tax evasion kicks in from today

SEZs may get a better tax recount in Budget
June, 18th 2009

The Union Budget on July 6 is expected to propose a change in the method of calculating income tax relief for special economic zone (SEZ) units to rectify a defect that limits their tax benefits, commerce ministry officials said.

Section 10AA of the Income Tax Act provides 100% exemption on SEZ export earnings for five years, but computes it with reference to the total turnover of the promoter company, or assessee. This leads to lesser tax relief for companies that have operations outside the special zone.

To rectify this, it is proposed that the Act be amended to compute tax benefits with reference to the turnover of the particular SEZ unit.

Our counterparts in the finance ministry have indicated that the amendment will definitely happen now, a commerce ministry official told ET Now on condition of anonymity.

The proposed amendment is a long-pending demand of the industry that even had the stamp of the previous governments empowered group of ministers (eGOM) on SEZs, headed by Pranab Mukherjee, the current finance minister. It did not materialise then because the revenue department resisted the move. With Mr Mukherjee calling the shots in North Block now, the revenue department has indicated that the amendment would be carried out, commerce ministry officials said.

Incidentally, SEZs managed an impressive performance last fiscal despite a deep fall in global trade. Merchandise exports from these zones rose more than one-third from Rs 66,638 crore in 2007-08 to Rs 90,416 crore last year.

However, experts and industry watchers believe that SEZ units may not be able to sustain this performance if they are not given the much-needed stimulus.

The anomaly should be corrected soon. SEZs are definitely affected by the global economic crisis and the pressures of slowdown will become more visible on their performance if this beneficial change is not made, said LB Singhal, Director General of the Export Promotion Council for EOUs & SEZ Units.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2019 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Careers

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