In a bid to give impetus to the industrialisation across the state, the Punjab Cabinet today gave green signal to a slew of liberal financial incentives for industrial promotion-2013 in manufacturing sector, integrated textile units, agro & food processing sector besides electronics, hardware and information technology. A decision to this effect was taken in a Cabinet meeting Chaired by Punjab Chief Minister Mr. Parkash Singh Badal here at CMO this morning.
Disclosing this here today a spokesperson of the CMO said that the incentive package had been framed after detailed discussions with all stakeholders, viz. Industrial associations, entrepreneurs and concerned government departments. The Package of incentives included retention of VAT and CST, exemption from Electricity Duty, exemption from Stamp Duty and Property Tax, waiver off Mandi Fee, Rural Development Fund (RDF) and Infrastructure Development (ID) Cess. The VAT and CST incentives up to 80% of the amount payable are being offered for the first time to the Manufacturing sector including Textiles, Agro and Food Processing while this exemption for Electronics Hardware and IT sector goes up to 100%. In the spirit of state government’s commitment to offer congenial and investor friendly environment to the entrepreneurs besides showcasing Punjab as the most preferred investment destination across the globe, the Cabinet also approved incentives like exemption of electricity duty, stamp duty and property tax to be offered to all sectors across the board. Likewise, incentives of Mandi Fee, RDF and ID cess would be available to integrated textile and Agro processing units. In a path breaking initiative the state government for the first time had offered several incentives including VAT/CST, Electricity Duty, Stamp Duty and Property Tax to small and medium Enterprise (SME) units having investment from Rs.1 crore to Rs.10 crore set up in the approved industrial parks/industrial focal points. Different zones have been established to offer incentives in less industrially developed districts with higher incentives as compared to relatively more developed districts. Higher incentives to the approved Industrial Parks, Industrial Estates and Industrial Focal Points would also be given to further boost industrial activities.
The Cabinet also decided to constitute a special committee under the Chairmanship of Chief Secretary to examine the issues viz. purchase tax on wheat, milk and cotton produced and processed within the state, food retailing, declaring of factory premises as Mandi yards, wheeling charges on import of power for entire industry and supply of un-interrupted power to IT industry. The committee had been asked to submit its report within 15 days to the Cabinet. The Cabinet also decided to reduce the domestic distant marketing subsidies from 500 KM to 230 KM for fruits, vegetables and flowers, so that these commodities could avail various subsides from Punjab Agro-Industries Corporation for marketing these commodities in Delhi market.
The following sectors had been given fiscal incentives under the industrial package:
Manufacturing Sector:
For all kind of manufacturing units including textiles
VAT and CST incentives
Electricity Duty, Stamp Duty, Property Tax exemptions
Eligibility period up to 13 years depending upon Fixed Capital Investment
Higher incentives to industrially backward areas, border districts, kandi areas and approved industrial parks/ industrial focal points
Special incentives to Small and Medium Enterprises (SME) set up in approved industrial parks/ industrial focal points
Integrated Textile Units:
For units with Fixed Capital Investment Rs.250 crore and above
VAT and CST incentives
Electricity Duty, Stamp Duty, Property Tax exemptions
Mandi fee, RDF, ID Cess exemptions
Eligibility period up to 13 years depending upon Fixed Capital Incentive
Higher incentives to industrially backward districts and approved industrial parks/ industrial focal points.
Agro and Food Processing Sector:
For units with value-addition to agri produce, high-tech agriculture etc.
VAT and CST incentives (no VAT on branded atta/suji/maida/ dalia on wheat purchased within the State)
Electricity Duty, Stamp Duty, Property Tax exemptions
Mandi fee, RDF, ID Cess exemptions
Electronic Hardware and IT Sector:
For IT/ IT enabled services, Electronic Hardware units, Wafer Fab enterprises
VAT incentive
Electricity Duty, Stamp Duty, Property Tax exemptions
Highlights
The incentives, until and unless specifically stated, are applicable to new units only.
Quantum of incentives linked to quantum of Fixed Capital Investment
All incentives are valid only during the eligible period, as specified in the package. Thus, an entrepreneur completing his project early shall enjoy incentives for longer duration.
Higher investment shall bring in higher quantum of incentives.
In another significant decision to boost the much needed Agriculture persification program, the Cabinet also gave approval to a pilot project for the promotion of Maize cultivation in Public Private Partnership (PPP) mode. The project was aimed at achieving enhancement of area under Maize cultivation by 40,000 hectares in 56 identified blocks. The proposed varieties of maize hybrid seeds would be cultivated, produced and harvested within 120 days from June 1, 2013.
To bring far more efficiency and sustainability of the rural drinking water supply schemes for ensuring supply of potable water in all 15170 habitations across the state, the Cabinet also okayed the recruitment of various 180 posts including 30 Sub pisional Engineers (SDEs), 120 Junior Engineers (JEs) and 30 Junior Draftsmen in the Water Supply & Sanitation department. The recruitment of SDEs would be carried by Punjab Public Service Commission while the JEs and Junior draftsmen would be recruited through an independent reputed agency. It was also approved that suitable recruitment would be made every year.
The Cabinet gave ex-post facto approval in terms of clause 2.3 of Excise Policy for the year 2013-14 for 100% allotment of liquor vends already achieved during allotments of liquor vends for the current fiscal. The Cabinet gave go ahead for implementing e-Trip/e-Governance to prevent leakage of revenue besides framing new rules 64-A, 64-B and 64-C. The implementation of e-Trip/e-Governance would result in additional revenue to the tune of Rs.200-300 crore annually.