SILIGURI: Service tax relief for exporters
Posted by barunroy on July 7, 2009
FROM THE TELEGRAPH
Siliguri, July 6: The disappointment at not being treated on a par with the Northeast with relation to tax waivers is there, but exporters have heaved a sigh of relief that they no longer have to pay the service tax.
“From 2007, we had been paying tax on services like transport while exporting goods. There is a provision of seeking refund but often there are delays in getting the money back so much so that some people just do not bother to pursue it. They don’t even try to pursue it although they lose out on quite a bit of money,” said Brijkishore Prasad, general secretary of the North Bengal Exporters’ Association.
“It is good that the finance minister today modified the process and made it clear that from now on, we need not pay the service tax. So there would be no question of refund.”
During his budget speech, finance minister Pranab Mukherjee read out that “services received by exporters from goods transport agents and commission agents, where the liability to pay service tax is ab initio (from the beginning) on the exporter, would be exempted from service tax.
Thus, there would be no need for the exporter to first pay the tax and later claim refund.”
In Siliguri, considered a key point of export to Nepal, Bangladesh and Bhutan and even China, exporters have welcomed Mukherjee’s announcement.
“It was unnecessary and a tedious job. At first we had to pay the tax and then apply for refund,” said Pranab Pal, a Siliguri-based exporter who sends goods, mainly groceries, to Nepal.
Tea exporters are happy that fringe benefit taxes (FBT) too have been abolished.
Ankit Lochan of Lochan Tea Limited, a prominent tea exporter in Siliguri, said: “For example if we send an employee by flight and spend Rs 10,000 on his ticket, we had to pay Rs 500 or so as FBT. Now that is no more.”
But not everybody is satisfied. “We have been demanding for long that north Bengal be included in the North East Industrial and Investment Plan, 2007 for industrialisation,” said Biswajit Das, the secretary of the Federation of Chambers of Commerce and Industry, North Bengal.
“Facilities like tax holidays and other packages and waivers can contribute in improving the industrial scenario of the region. But even this year, the Centre did not confer us a similar status like the Northeast.”
