Annual trade policy 2007: Service tax exemption for services exports

New Delhi: The ''annul trade policy for 2007'' notified today has exempted services exports from service tax. The policy has also expanded the scope of a host of schemes to boost merchandise exports while fixing a target of $160 billion for 2007-08.

The ''annul trade policy for 2007'' is an annual supplement to the 5-year ''foreign trade policy: 2004-2009''

Announcing the 2007 supplement, commerce and industry minister Kamal Nath said the export target of $125 billion for 2006-07 has been met and the government hopes to achieve $160 billion in the current financial year.

Nath said that in addition to merchandise exports, exports of services accounted for another $76.10 billion.

The ''vishesh krishi'' and ''gram udyog yojana'' for promoting agriculture exports has been expanded to include soyabean and coconut oil as well as food preparations such as soups.

The government has also extended the popular duty entitlement passbook (DEPB) scheme for exporters till March 2008. A new scheme to replace DEPB would be finalised by then, Nath said.

Further, the focus product and focus market schemes have been expanded to include additional items and 16 more countries. The corpus of focus product scheme has been increased to Rs1,000 crore from Rs650 crore last fiscal.

In a bid to encourage SEZs, Nath said, developers and co-developers of these zones would be covered under duty refund schemes.