The Hindu Business Line : Seafood units on stir against withdrawal of DEPB scheme

OVER 400 seafood-processing units across the country on Monday began a three-day strike, protesting against the tax levied on income from the Duty Entitlement Passbook scheme.

Mr Elias Sait, Secretary General, Seafood Exporters Association of India, said purchases of seafood and processing had come to a halt. Exporters are protesting the amendment that paved the way for levying the tax on the DEPB scheme.

The arrears work out to about Rs 500 crore and could break the processors, Mr Sait added. The DEPB scheme was an incentive given to the exporters by the Union Government, which has now has decided to withdraw it with retrospective effect. The processors have used these concessions to cover production costs. Over 80 per cent of the processing cost is on account of seafood.

The strike means that the units would not purchase seafood from fishermen and produce from the aquaculture farms. The fishermen had also expressed support for the processing units, he said.

Through an amendment of the Income Tax Act, the DEPB income on export turnover of more than Rs 10 crore has come under the tax net. The export incentive was granted for the period between 1997 and 2002. The processors are now facing tax claims totalling about Rs 500-700 crore, according to the exporters' association.

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