Industries located in SEZs get a host of fiscal advantages over those located outside them. The SEZ Policy of the Government of India lays down a number of financial benefits for manufacturing units in the SEZ. The advantages include:
- Direct Tax Benefits – Income Tax
- 100% exemption for the first 5 years
- 50% exemption for the sixth to tenth (next 5) years
- 50% exemption on the ploughed back profits, for an additional 5 years, after ten years
- Exemption from Minimun Alternate Tax
- Indirect Tax Benefits - Perennial exemption in all taxes including
- Excise Duty
- Custom Duty
- Service Tax
- Value Added Tax (VAT)
- Stamp Duty / Lease Tax
- Entry Tax and various other State levies that would otherwise be applicable on operations
- Domestic Tariff Area (DTA) supplier is eligible for export benefits on SEZ sales making the sourcing cost competitive.
- External Commercial Borrowings upto US $ 500 Million without any specific approvals. Cost competitive financing can be availed from Offshore Banking Units (OBUs).
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