Shambasiv
(n/a)
21 January 2008
[align=justify]Incentives and Concessions[/align][align=justify]
[/align] [align=justify]As per the Industrial Policy 2001-06, following incentives and concessions are offered to industries in Karnataka. [/align] [align=justify] [list][*] Investment subsidy to all new tiny and small scale industries to be established in areas other than developed areas. The quantum of subsidy ranges from 10% to 25% of the value of fixed assets subject to a maximum of Rs.5 lakh to Rs.12.5 lakh respectively, depending on the zone. This subsidy is also available to all existing tiny and SSIs undertaking expansion, diversification or modernisation. [/*][*] Additional subsidy to an extent of 5% of the value of fixed assets subject to a ceiling of Rs.1 lakh to entrepreneurs belonging to SC and ST and Women Categories. [/*][*] Entry Tax Exemption to all new industries including large and medium scale industries for a period of 3 to 8 years depending on the location of the project and subject to certain conditions. [/*][*] Special concessions for Export Oriented Units and 100% Export Oriented Units by way of exemption from payment of ST and ET on purchase of raw materials, components, packing materials etc. [/*][/list] [/align] [align=justify]In addition, entrepreneurs who belong to Scheduled Caste / Scheduled Tribe, will be offered industrial plots / sheds, by KSSIDC at subsidised rate to the extent of 40% of the total cost, subject to maximum limit of Rs.2.00 lakh vide G.O. No. CI 305 CSC 2004 dt.19.7.2005. [/align] [align=justify]Incentives pertaining to Special Economic Zone (SEZ) Government of India, inorder to boost exports from the country formulated a new scheme viz Special Economic Zone (SEZ) during 2001. Accordingly, the State Government has formulated a State Policy for Special Economic Zone (SEZ) vide GO No C1/282/SP1/2001 dtd 25.2.002. As per this policy, following incentives are offered to the investors: [/align]
[list=1] Exemption from all State local taxes and levies [/*] Exemption of Stamp duty and registration fees. [/*][/list] [list][align=justify] In addition, following initiatives have also been spelt out in the policy: [/*] [/align][/list] 1. Delegation of Labour Commissioner's power to the designated Development Commissioner [align=justify]2. SHLCC to consider special package of incentives and concessions to Anchor and downstream projects. [/align] [align=justify]Further, Lok Sabha has passed the Special Economic Zone Bill 2005, in May. The Bill provides a Single Window Clearance and approval mechanism for establishment of SEZs as well as production units inside the Zones. The Bill contains income tax concessions for SEZ units as well as SEZ developers, who will be eligible for 100% tax exemption for five years, 50% for the next five years and 50% of the ploughed back export profits for the next five years. SEZ developers continue to get 100% income tax exemption for 10 years in a block period of 15 years. [/align] [align=justify]In addition to Income Tax related concessions, developer and the entrepreneur of SEZ are and entitled to exemption of Services Tax under the Chapter - V of the Finance Act, 1994 and fiscal concessions under Customs Act, 1962, Central Excise Act, 1944 and Central Sales Tax Act, 1956 as envisaged in the Bill. [/align] [align=justify]Currently, units in SEZs are allowed 100% deduction of export profits for five years, 50% of the export profits for the next two years and 50% of the export profits ploughed back for the next three years. To be eligible for this tax concession under Section 10A of the Income Tax Act, an SEZ unit should have started manufacturing or developing computer software after 31 st March 2002. [/align] [align=justify]
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