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K.R. Srivats

New Delhi , April 4

THE Finance Ministry has further improved the existing service tax exemption on the taxable services provided to a developer of a special economic zone (SEZ) or a unit in such a zone. It has made obtaining such exemptions much easier.

Besides relaxing the conditions for obtaining such exemptions, the revenue department has also done away with the norm that required the taxable services provided to a developer or a unit to be authorised by a committee headed by the Chief Commissioner of Central Excise having jurisdiction over the SEZ.

Informed sources said that a service provider could now provide any of the 58-odd services to a developer or a unit in a SEZ and claim service tax exemption without any authorisation from the concerned Chief Commissioner of Central Excise for the service being rendered.

The revenue department has, however, now held that the service tax exemption would be available on services provided to a developer only if the developer were to be approved by the Board of Approvals to develop, operate and maintain the SEZ.

Prior to the latest change, the service tax exemption was available only if the developer had been granted permission or authorisation by the Development Commissioner to develop, operate and maintain the zone.

In the case of a SEZ unit involved in a product coming under the automatic route, the revenue department has now held that the unit will have to be approved by the Development Commissioner.

For SEZ units involved in products that do not come under the automatic route, the concerned unit will have to obtain the approval of the Board of Approvals.

The Finance Ministry has also done away with the procedure that required a developer of a SEZ or a unit in a SEZ to submit quarterly statement to the commissioner of central excise having jurisdiction over the concerned SEZ.

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