Ahead of the much hyped Global Investment Summit scheduled for early next month, Assam Government increased the limit of tax exemption for medium and large units from 100% to 150% of the fixed capital investment where as for mega units tax exemption is proposed with the maximum ceiling of 200 percent of fixed capital investment.
Assam Finance Minister Himanta Biswa Sarma said this on Friday, while adding that the Government has for the first time decided to include the proportionate investment in land in the fixed capital investment of the new units.
“Tax reimbursement shall be available to the units existing on the date of transition to GST as well as to the new units set up after July 1, 2017 during GST regime but upto December 31, 2022,” he said adding that no other state in the country has been able to announce such an extensive scheme for benefit of the investors in the GST regime.
Sarma said that although the government of Assam would lose approximately
Rs 450 crore for existing units and even more after the Global Investment Summit, which will be held on February 3 and 4, it will give confidence to the investors and businessmen. The Minister also said that the revenue loss will be offset by employment generation in the state.
“I am sure that the state will gain in long term in terms of investment,” he said.
“This scheme provides 100 percent tax reimbursement every year irrespective of any capacity utilization for 15 years, as compared to the previous industrial policy of 2014. The reducing system of tax exemptions from 100 percent to 80 percent and then to 50 percent in subsequent years and linkages with capacity utilization have been removed. It will substantially improve the working capital flow of units,” he said giving the details of the scheme.
“In order to promote tourism, 100 percent tax reimbursement to hotels and resorts above 2 star and river cruise is proposed for 15 years, subject to applicable monetary ceiling. Earlier the tax exemptions was limited to room rent only but now it would extend even to food, beverages and other services,” he said adding that special provisions have also been made for promoting power generation through renewable source of energy by including such investments in the fixed capital investment of and existing unit.