The incentives are being phased out as given by the following table
Tapering Down Of Export Incentives And Incentive For Earnings In Foreign Exchange
Asst Years
| |
2000-01 |
2001-02 |
2002-03 |
2003-04 |
2004-05 |
2005-06 |
|
Deduction For Exports Profits -Sec 80 HHC |
| | | | | |
|
Deduction for profits From export of computer software's -Sec 80HHE |
100% | 80% | 60% | 40% | 20% | |
|
Deduction For Profits From Export Of Film Software -Sec 80HHF |
| | | | | |
The compulsions behind the withdrawal as also the international comparisons need to be made public by Government.
100% EOUs and FTZ units commencing manufacture after 31/3/2000 would not be entlted to exemption. It should be appreciated that no undertaking commences business overnight. Unless transitional provisions are enacted to cover units under construction/commissioning the withdrawal of exemption would be extremely harsh. Could we expect a favourable administrative clarification at least ?
Withdrawal of the Capital gains tax exemption u/s 54EA and 54EB and introduction of Sec 54EC provding for exemption for investments in NABARD and NHAI:
At present the capital gains on sale of long terms capital assets provided the gains/net consideration is invested in Infrastructure Bonds that are notified by Government. This is being discontinued.
The investment of gains in bonds with a tenor of 5 years issued by NABARD and NHAI would qualify for the exemption.
Comment:
The wisdom of the move is certainly questionable. The provisions enabled promotors of the private sector infrastructure companies to raise funds through liquidation of other assets is being dispensed with.
