By TIOL News Service

NEW DELHI, NOV 30, 2014: IN addition to Seven Central Government Special Economic Zones (SEZs) and 11 State/Private Sector SEZs set-up prior to the enactment of the SEZ Act, 2005, approval has been accorded to 524 proposals out of which 352 SEZs have been notified.  There are a total of 196 functional SEZs. The fiscal concessions and duty benefits allowed to Special Economic Zones (SEZs) are in built into the SEZs Act, 2005 and SEZs Rules, 2006 framed thereunder. These exemptions are uniformly applicable to all SEZs and are in the nature of incentives for export and are consistent with the principles that guide export promotion initiatives of the Government in general.

Recently Board of Approval on Special Economic Zones (SEZs) has approved for de-notification/ cancellation of 35 notified/formally approved SEZs as the progress made by the Developers of these SEZs is not satisfactory. These de-notification/ cancellation are subject to payment of all applicable duties and tax benefits availed by the Developer and receipt of No-objection Certificate (NOC) from the concerned State Government. Further, 18 in-principle approved SEZs have been cancelled by the Department owing to no further action has been taken by the Developers.  

There have been demands from various quarters for discontinuing of Minimum Alternate Tax (MAT) imposed to SEZ Developers and Units and Dividend Distribution Tax (DDT) levied on SEZ Developers.  Ministry of Commerce and Industry (Department of Commerce) had recommended the restoration of original exemption from Minimum Alternate Tax (MAT) and Dividend Distribution Tax (DDT) to SEZ developers and units. However, Ministry of Finance has not agreed.

As per entry no. 18 of the State list in the 7th schedule to the Constitution of India, land is a State subject.

Review of functioning of SEZs is an on-going process and on the basis of inputs/suggestions received from stakeholders on the policy and operational framework of the SEZ Scheme, Government periodically takes necessary measures so as to facilitate speedy and effective implementation of SEZ Scheme.