What is Special Economic Zone? Objectives of SEZ Act 2005, Riverse & Finance SEZs

SPECIAL ECONOMIC ZONE
SEZ – Special Economic Zone
Government of India is planning to make changes in the SEZ Act.
SEZ- SPECIAL ECONOMIC ZONE

An area which is subject to less economic regulations than other regions within the same country.
In India, SEZ Policy was first announced in 2000.

SEZ act 2005

Special Economic Zones Act was passed in 2005.
During 2000 to 2006, SEZ were functioned as per the Foreign trade policy.

SEZ – OBJECTIVES

Promotion of Investment.
Promotion of
Boosting extra economic activity.
Infrastructure Development.
More Employment opportunities.

SEZ – INCENTIVES
Income tax exemption on export income:

100% for first five years.
50% for the next five years.
50% of the export profit reinvested in the business for the next five years

SEZ – INCENTIVES
GST

supplies to SEZs are zero rated under the IGST Act, 2017

SEZ – INCENTIVES

Duty free import and domestic procurement of goods.
Exemption from Minimum Alternate Tax (MAT).
Single window clearances for all state and federal government approvals

2018 – Baba Kalyani Committee Recommendation

Framework shift: Export growth to broad-based employment and economic growth.
Rename: Employment and Economic Enclave (EEE).
One integrated online portal for new investments.

2018 – Baba Kalyani Committee Recommendation

Separate rules and procedures for manufacturing and service SEZs.
Extension of Sunset Clause and retaining tax or duty benefits

2022-23 UNION BUDGET About SEZ

SEZ Act to be replaced by a new legislation which will enable large existing and new industrial enclaves for optimal utilisation of available infrastructure and enhance competitiveness of exports.

2022-23 UNION BUDGET About SEZ

Customs administration in SEZs will be fully IT-driven.
Single window clearance and provide high class infrastructure.
Provision for allowing domestic units to come up in the unutilized area of SEZs and co-exist with SEZ units with proper monitoring.
Enable the States to become partners in development of enterprise and service hubs.