Punjab govt to amend industrial policy, give sops on intrastate sales
The government also approved global tendering for the upcoming hi-tech cycle valley on a 100-acre industrial park in Ludhiana.punjab Updated: Oct 17, 2018 17:44 IST
The Punjab government Wednesday decided to amend the industrial policy to give investment incentives by way of Net SGST on intrastate sales to promote business enterprises in the state. The state cabinet meeting, chaired by chief minister Amarinder Singh, also approved global tendering for the upcoming hi-tech cycle valley on a 100-acre industrial park in Ludhiana, an official statement said here.
The Cabinet noted that since the government could not give direct concessions to industry in matters of land acquisition, other incentives should be provided through amendment to the policy so that both the state and the industry get the best deal through measures such as global tendering.
The Cabinet observed that for effective implementation of the policy there was need to explicitly define and explain the term ‘Net SGST Incentive’. A series of meetings/consultations were held among departments of Excise and Taxation, Finance, Industries and Commerce and Investment Promotion, the statement said.
After deliberations, a detailed formula for different eventualities was finalized in the meeting under the chairmanship of the Finance Minister.
According to the new formula, incentive amount would be calculated based on output IGST (or CGST+SGST), that would be called GST rate for formula, the statement said.
Overall quantum and/or period for claim of incentives shall remain same as defined in IBDP-2017 (as amended from time to time) for the respective category. Availing of incentives up to the overall ceiling i.e. 200 per cent/125 per cent/100 per cent of FCI, as applicable, shall depend on the capacity utilization of the unit during the eligibility period, the statement said.
The incentive under the present policy would only be applicable for such investment proposals where Common Application Form has been submitted by March 31, 2020.
This formula would be subject to various conditions. In the case of a unit with multiple outputs having more than one GST rate, the incentive amount shall be calculated pro rata to the respective sales (value as defined in GST law) of eligible outputs, the statement said.
If the amount calculated as above is less than 2.5 per cent of the FCI in any particular year, the unit will be entitled to get such difference as the additional amount of incentive, subject to the fact that it has been able to achieve sales of three times of the FCI. For example, if the GST incentive for a unit with FCI worth Rs 100 crore and sales of Rs 310 crore in a fiscal year (FY) comes to Rs 1 crore in the FY, the unit shall be able to get an additional amount of Rs 1.5 crore as incentive, the statement said.
The unit operating for a part of the year of the incentive period will get the amount on pro rata basis, with the requirement of sales being three times of FCI also applying on a pro rata basis.
With respect to the cycle valley to be developed in Dhananshu village of Ludhiana district, as per an earlier decision of the state government, the Cabinet decided that the 100 acres of undeveloped land would be allotted through an objective, open, competitive and technical bidding process to a well-established company of international repute.
The selected project company would be responsible for the development of the entire industrial park in the allotted land. It would develop its own anchor unit in 50 acres and in the remaining 50 acres the company would invite major national and international manufacturers as ancillary and/or vendor units, the statement said
First Published: Oct 17, 2018 17:43 IST