November 25, 2006 1:20:40 am
Tax holidays to special economic zones (SEZ) are estimated to lead to a revenue loss of over Rs 1,00,000 crore by 2009-10, the Ministry of Finance informed Parliament today.
Of the estimated revenue loss of Rs 1,02,621 crore between fiscal 2007 and fiscal 2010, the total loss on account of direct taxes is estimated to be Rs 53,740 crore, while that on account of indirect taxes is pegged at Rs 48,881 crore, Minister of State for Finance, S.S. Palanimanickam told the Lok Sabha in a written reply.
To the extent that tax concessions to units in SEZs erode the legally defined tax base, the revenue loss is permanent, he said.
In response to another question, the minister said that the reported increase in prices of cement cannot be attributed to excise duty as there has been no change in the rate of the levy since March 1, 2003 except for imposition of education cess.
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At present, the general rate of basic excise duty on cement is Rs 400 per metric tonne, he said, adding cement is a decontrolled commodity and the prices are determined by market forces.
Replying to another question, Palanimanickam said that the Income Tax Employees Federation and Income Tax Gazetted Officers Association have opposed outsourcing the job of accepting income tax returns to post offices.
It has been decided to process these returns centrally, he said, adding it would facilitate issue of refunds quickly.
As many as 412,278 tax returns have been received through the post offices in the country up to October 31 this year, Palanimanickam said.
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