TN to provide tax benefits for S districts

Chennai: The Tamil Nadu Government has announced a structured incentive package to attract industries to the southern districts.

Replying to discussions on the demand for grants to the Industry Department, the Minister for Local Administration, Mr M.K. Stalin, told the Assembly, attractive VAT-related incentives, in addition to those enumerated in the industrial policy announced recently, have been provided to attract investments to the industrially backward districts in the South.

The State Government provides tax incentives for investments over Rs 250 crore made anywhere in the State. But for the southern districts, investments over Rs 50 crore would get such tax benefits.

The benefits are: For investments between Rs 50 crore and 100 crore the incentive would be a soft loan equalling VAT and CST paid during first three years; for investments of Rs 100-200 crore a soft loan equalling VAT and CST paid during first four years; and for investments between Rs 200 crore and Rs 250 crore a soft loan equal to the VAT and CST paid during the first five years with an interest of 0.1 per cent. The loan is repayable from the eighth year onwards.

This would be in addition to the incentives allowed under the industrial policy, he said.

Also, the industrial policy provides for similar VAT incentives to be repaid with 0.1 per cent interest for investments between Rs 250 crore and Rs 1,500 crore. In the case of such investments in southern districts this amount is treated as grant. This would be a refund in the form of investment promotion subsidy, he said.

Further, to attract investments to South Tamil Nadu, special focus would be on this region for infrastructure development. This would include expediting the four-laning of the national highway linking Madurai-Tuticorin and Madurai-Tirunelveli, expansion of Madurai and Tuticorin airports and improving efficiency of the Tuticorin Port through mechanisation and deepening of the draught to enable entry of larger cargo carriers.

The State Industries Promotion Corporation of Tamil Nadu will develop at least four-five new industrial estates of 1,000-2,000 acres, he said.

The Tamil Nadu Industrial Development Corporation will set up a multi-product SEZ in Virudhunagar at an estimated cost of Rs 500 crore through public private participation. This will attract investments that will generate over 50,000 jobs, Mr Stalin said.