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The Centre's move to extend the tax holiday available to outsourcing companies located in Special Economic Zones (SEZs) has been given a thumbs up at a time when the industry is looking for every possible help.
Welcoming the move, BVR Mohan Reddy, Chairman, Nasscom, said that extension of Section 10AA for SEZ units till 2020 is a positive. This will enable technology units to set up and commence operations in SEZs, Reddy added.
Vikram Doshi – Partner, Tax at KPMG in India, said that the proposal to introduce a sunset clause for SEZ tax holiday could impact sector.
Others in the industry point out this is an important development as getting units there t be operational requires time. “ The government has responded positively to representation from the Industry to extend the sunset date on units in SEZs on account of the gestation time taken to operationalise production units present there,” said Jatin Dalal, Chief Financial Officer, Wipro.
India's $160-billion IT industry also applauded the Centre's decision to apply section 80 JJAA, which gives rebates to the company for paying additional wages to new regular workmen employed during the previous 3 years.
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