The Maharashtra government has decided to increase the stamp duty exemption for Special Economic Zones (SEZ) developers from the existing 10 years to 25 years. The move is seen as a sweetener for those keen on investing in the state. The state cabinet on Tuesday cleared the proposal in which developers or co-developers of SEZs and businesses being set up in these SEZs will be exempted from paying stamp duty and registration for the first land transaction, including purchase or leasing.
The proposal was initially mooted in 2007 when Maharashtra had received Board of Approval nod for setting up 72 SEZs in the state. It had subsequently decided to give SEZ developers, co-developers and units operating in these zones stamp duty exemption for 10 years, under the Bombay Stamp Duty Act, 1958.
Interestingly, the initial proposal in 2007 was to give exemption for a period of 25 years, but the proposal was struck down and the time frame was limited to 10 years. Government officials claimed that with the 10 year period having lapsed this year, many businesses that were being set up in such SEZs, like the MIHAN in Nagpur, were not getting this benefit.
Maharashtra Industry Minister Subhash Desai said this extension would further facilitate investment in the state.
Interestingly, the request to extend the term of this tax holiday was made by MIHAN in May this year. The Maharashtra government has so far given formal approvals to 57 SEZs and in-principle approvals to 11. Of these 28 are functional SEZs.
Before the previous tax holiday lapsed, 665 investors across these 28 SEZs had benefited from the scheme. The government has, however, stated that all those who had entered into a transaction after March 2017 when the scheme had lapsed will not be refunded the amount. The government also plans to review the tax holiday every five years.
Meanwhile, the cabinet has also decided to clear the proposal of setting up a seed park in Jalna. The government is hoping that this park will have a turnover of Rs 6,000 crore and will provide employment to 40,000 people. The park will contain value-added secondary processing facilities, dehumdification godowns for storing seeds, seed testing labs and research facilities.