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Wednesday, Apr 07, 2004

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Export benefits at 10 pc of forex earned sought

Our Bureau

New Delhi , April 6

THE PHD Chamber of Commerce and Industry (PHDCCI) has urged the Government to continue with the Section 80HHC benefits to exporters, although in a different form.

In a memorandum to the Government, the Chamber said that the benefits under Section 80HHC should be allowed at 10 per cent of the foreign exchange earned/received during the year by the assessee.

"The phasing out of deduction under Section 80HHC should be reconsidered. The benefits must be continued in a form that is linked to the foreign exchange earned/received by the assessee in a year and not by the profits made by the exporter," a PHDCCI official said.

It said that exports suffer from various handicaps including higher transaction cost, transportation, fuel and port costs. This reduces the profit margin for the exporters. Continuation of tax incentives is imperative to offset these handicaps.

"At a time when export margins are under great pressure due to high volatility of the rupee against the dollar, any cut in benefits to the exporters will adversely affect our drive to achieve one per cent of global trade in the conceivable future," Mr Ravi Wig, President, PHDCCI, said.

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