Amiti Sen & Deepshikha Sikarwar, New Delhi
The Economic Times (Delhi edition)
A number of policy issues that could decide the fate of special economic zones (SEZs) set up by companies including Essar, Adani, Infosys, and TCS will be taken up by the empowered group of ministers on Special Economic Zones (SEZs) on Friday.
The group, headed by external affairs minister Pranab Mukherjee, will try to decide on the definition of ‘vacant land’ which in turn would decide whether Essar’s steel SEZ in Hazira and Adani’s port SEZ should qualify as an SEZ or should be stripped off the status.
Attorney general Milon Bannerjee has given his clean chit to the Essar’s proposal for the second time. EGoM in its last meeting had asked the department of commerce to seek Bannerjee’s opinion for the second time.
Also on the agenda is the Adani group’s request to be allowed to merge its three SEZs in Mundra, Gujarat to form a single SEZ. This would be a landmark decision as the merger would result in a SEZ that would breach the land ceiling of 5,000 hectares.
The imposition of export duty on steel supplied by domestic producers to SEZs, which has been challenged by the commerce department, will also be taken up by the eGoM. “It is unfair that export duty has to be paid on steel supplied to SEZ units and developers. Since the steel is staying within the country, there is no logic behind imposition of the duty. We hope the eGoM will remove it,” an official said.
The eGoM will also review section 10 AA (7) of the income tax act, which states that only a proportion of profits based on the proportion of export sales from the SEZ unit to the total turnover of the company will be exempt from taxation. If section 10 AA (7) is not reviewed and changed, it would prevent IT companies such as Infosys, and TCS, from enjoying 100 percent tax exemption on their profits as they have set up SEZ units under the parent company and not as independent subsidiaries.
0 comments:
Post a Comment