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CM objects to Centre denying tax holiday benefits to Goa

Written by: Staff
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Panaji, Aug 8 (UNI) Strongly objecting to extension of tax holiday and excise benefits to Himachal Pradesh, Sikkim and Uttaranchal, Goa government today urged the Centre to benefit the smaller state of Goa to prevent migration of the industries.

Interacting with media persons after the Cabinet meeting which expressed unhappiness against the central decision, Goa Chief Minister Pratapsingh Rane said the Centre should ''play a level playing field'' to protest the interests of small state like Goa.

He urged the Prime Minister and the Union Finance Minister to extend the same exemptions to Goa to encourage further industrialisation of the state. It could prevent the existing industries from migrating to the three states besides motivating the new industries to set up in Goa.

He also recalled Finance Minister P Chidambaram saying in Goa during his visit last year that the tax benefits would not be extended beyond March 2007 to all the states.

The green field benefits to the three states had already resulted in migration of about 11 pharma industries which included the majors like Cipla, Dr Reddy Labs, Ranbaxy Labs, Cadila Gealth Care, Meditab Specialities. Indoco Remedies, Wallace Pharma, Micro labs, Unichem Labs and Glenmark Pharma and Blossom Pharma.

The Goa Pharmaceuticals Manufacturers Association, had in an appeal to Chief Minister sought his intervention by asking the Union Finance Minister to reduce excise duty on medicines to 8 per cent from the existing 16 per cent to reduce the disparity between duty free states and the others.

The problems of the pharma industry could be mitigated to a large extent by reducing the central excise duty to 8 per cent with Cenvat benefits or reducing it to 4 per cent without Cenvat benefits, the association told Mr Rane.

Mr Rane said he had also received another representation from the Goa Chamber of Commerce and Industry(GCCI) in this regard saying the central decision would affect Goa's capacity to raise revenue and generate employment.

''With the extension of these incentives, it will be nearly impossible to seek fresh investments in Goa. The exemptions notified to the three states included 100 per cent excise duty on the output by new units for a period of 10 years from the date of commercial production.

Another major incentive was income tax holiday which is now made available till 2013. These incentives, due to expire on March 31, 2007 had been extended to March 31, 2010.

The Chief Minister said he would shortly leave for Delhi to bring this to the notice of Prime Minister and Foreign Minister seeking extension of the benefits to Goa.

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