The Commerce Ministry has asked the Finance Ministry to include provision for exempting units in the National Manufacturing and Investment Zones (NMIZs) from capital gains tax in the Direct Taxes Code (DTC) Bill.
In the first meeting of the Manufacturing Industry Promotion Board (MIPB) on Tuesday, Commerce and Industry Minister Anand Sharma, who also chairs the Board, asked the Revenue Department to do the needful.
“The Department of Revenue was asked to ensure that the dispensation pertaining to relief from capital gains tax as approved in the National Manufacturing Policy, is included in the Direct Tax Code (DTC) Bill, as was indicated by them,” an official statement said.
The Government had announced the National Manufacturing Policy to give a push to manufacturing by offering a host of sops, including capitals gains exemption, to units in mega industrial zones called the NMIZs.
The Manufacturing Industry Promotion Board meeting was attended by Secretaries from various Ministries and Departments, including Economic Affairs, Science & Technology, Revenue and Heavy Industries.
The Board reviewed the progress of the proposed zones and decided to carry out another review after three months for the early implementation of these mega infrastructure projects.
Capital goods boost
The Department of Heavy Industry was asked to outline measures to strengthen public sector industries in the capital goods and also give a list of capital goods that have been adversely affected due to inverted import duty structure.
There are a number of capital goods where the country has substantive domestic manufacturing capacity but are hit as the import duty on inputs to produce those goods is much higher than the import duties on the final products.
The recommendations made by the Department of Heavy Industries will be discussed in the next meeting of the board.