Jaitley to meet FM to get tax sops for exporters

The rupee’s rise is giving exporters some sleepless nights. Now the political machine is getting into the act.

In a bid to pacify exporters, hit hard by sharp rise in rupee, Commerce Minister Arun Jaitley will meet Finance Minister Jaswant Singh early next week and seek tax sops, including restoration of income tax exemption. The two ministers are expected to meet on Monday, government sources said, adding that Jaitley may seek support for tax exemption for Duty Entitlement Pass Book (DEPB) scheme and sops under Section 80 HHC of the Income Tax Act for exporting income. The proposed meeting assumes importance in the wake of exporting community calling on Jaitley yesterday to seek government support on the ground that withdrawal of tax benefit in tandem with declining dollar was proving detrimental to exporters’ interests.

Sources, however, indicated that government was unlikely to take steps to arrest the rise in rupee. The Federation of Indian Export Organisation (FIEO), in a meeting with Jaitley yesterday, had demanded that the rate of dollar should be fixed for exporters for at least one year and exporters should be provided dollar denominated credit to avoid high interest rate burden.

Apart from asking government to take steps to protect exporters from the perils of hardening rupee, fieo also demanded that the move to tax retrospectively incomes out of DEPB should be done away with and exemptions be restored under Sec 80 HHC.