Commerce ministry for retention of SEZ sops

Commerce ministry for retention of SEZ sops

“We have told the finance ministry to continue the SEZ benefits in the new tax code,” a senior commerce ministry official said.

The ministry has underscored the need for continuation of the tax-free enclaves, stating that fiscal sops are the main attractions for the promotion of SEZs.

The draft direct tax code that will lead to the overhaul of the Income Tax Act has created ‘uncertainty’ among the developers and units in the SEZs.

While the discussion paper on the code says the profit-linked and other incentives would remain applicable even after the new tax regime comes into effect, its explanation of ‘grand-fathering’ the sops has created an apprehension among investors.

The Export Promotion Council for Export Oriented Units and SEZs has also urged finance ministry to clarify how the developers and the units operating in these zones would continue to get tax benefits.