Our Say |
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| These
reforms come in despite an adverse
recommendation by the Kelkar Committee,
which had recommended the abolition
of tax exemptions for backward
areas, since they caused serious
distortions in economic efficiency.
The task force had instead recommended
expenditure grants. But the move
seems to be working since several
infotech and auto ancillary companies
are now seeking registration in
these states. |
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The
amount of deduction will, however, be reduced
from 100 % to 25 % for enterprises in Himachal
Pradesh and Uttaranchal after five years.
Also, the units which avail of the benefits
under Section 80-IC will not be eligible for
other tax concessions like export processing,
etc. The department of industrial policy and
promotion has also asked the revenue department
to expedite the issue of the notification.
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