labels: economy - general
Non-processing areas of SEZs not to get tax exemptions, say state governmentsnews
05 May 2007

Mumbai: Non-processing areas of special economic zones (SEZs) will not be eligible for tax exemptions, state governments said.

"The empowered committee of state finance ministers on VAT unanimously feel that in non-processing zones of SEZs, no one should impose on states anything relating to states tax exemptions," VAT panel chairman Asim Dasgupta said.

"In other words, we are against any state tax exemption in any non-processing part of SEZs," he said after a VAT panel meeting.

While several states have already come out with SEZ policy giving exemptions on overall SEZs, he said, "What happened has happened. We are now of view that on non-processing zones of SEZs no one should force states that they have to give tax exemptions," he said.

The union commerce ministry had also written to states to provide tax exemptions to SEZs.

While the views of the states are in conformity with the centre''s SEZ Act, Dasgupta said, "we are communicating our views to the centre because it is the unanimous view of all states."

A union finance ministry official, meanwhile, said the views of states are also in line with the SEZ Act.

The move will have great revenue implications for state governments.


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Non-processing areas of SEZs not to get tax exemptions, say state governments