INSUBCONTINENT EXCLUSIVE:
Mumbai: With the Union budget not extending the Sunset Clause beyond March 31, the recent rush seen among corporate tenants to operate out
of Special Economic Zones (SEZ) in order to avail tax benefits is likely to abate.
Experts, however, said that the government may announce a
new framework, as SEZs have proved their employment generation and export potential over the last decade or so.
According to Section 10AA of
the Income Tax Act, units in SEZs get a phased tax-holiday for a period of 15 years
supply comes from SEZs, and Information Technology SEZs form a major chunk of exports, valued at more than $43 billion annually.
Technology,
Ramita Arora, managing director (Bengaluru), Cushman and Wakefield.
Units in SEZs that start operations from April will not be eligible for
The Sunset Clause will, however, not impact their indirect tax calculations, as they will continue to receive benefits such as exemptions on
GST and incentives on exports, as long as they are operational
operational IT SEZs in the country, Bengaluru leads with a share of 32 per cent , followed by Hyderabad at 16 per cent , Pune at 14 per cent
and Chennai at 14 per cent
Since the SEZ Act came into force in 2005, over 2 million jobs have been created, with an incremental annual growth rate of 25.2 per cent
This fact will be given due attention when the government contemplates a new framework to boost both exports as well as employment in these
Kalyani, also sought an extension of the sunset date from March 2020 for the services sector in order to retain the benefit of the existing
income tax exemption on their export proceeds.