Companies can’t avail any other income tax benefit if they are availing reduced rate of tax, a government official told ET.
Electronics manufacturers are seeking clarity from the Finance Ministry on the applicability of various incentives and exemptions available to them in the new concessional tax regime.
Some of these companies are also asking the Ministry to extend the 15 percent tax rate–announced for new manufacturing units –to existing manufacturing units as well, ET reported.
Industry executives believe that this will remove doubts among the investors and will speed up flow of investments into this sector.
Phone and component manufacturing companies are also seeking clarity if existing benefits such as tax breaks under Special Economic Zone, capital subsidies and export promotion schemes will continue to be available under the new regime.
Meanwhile, a government official told ET that companies can’t avail any other income tax benefit if they are availing reduced rate of tax.
“Everything has to be new if they want the 15 percent tax rate, else they can take advantage of the reduced corporate tax rate of 22 percent,” the official was quoted as saying.
According to Indian Cellular and Electronics Association (ICEA), even some deductions such as Scientific Research Allowance– a sop for units in SEZs–and investment in new plant and machinery in notified backward areas, will not be available for both 15 percent and 22 percent windows.