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Goa withdraws sales tax exemption

Sandesh Prabhudesai in Panaji

In view of the value-added tax regime beginning from April next year, Goa has decided to withdraw sales tax exemption and replace it with a new subsidy scheme for all industries.

The scheme -- Goa Sales Tax Deferment-cum-Net Present Value Compulsory Payment Scheme, 2001 -- comes into force with immediate effect.

Besides income tax holiday, Goa was also granting sales tax exemption for 10 years to small-scale industries and five years' ST exemption to the medium and large-scale industries.

With the Centre threatening to cut down assistance to states 25 per cent if such exemptions were not withdrawn before the VAT regime commences, Goa has rushed to introduce the new scheme.

Industries will now have to pay 50 per cent sales tax of the total value every month, while considering remaining 50 per cent as subsidy.

Goa has given time till July 31 to industries to register themselves. In case of small industries, it would be provisional registration. Medium and large-scale industries will have to apply to the high power co-ordination committee for registration.

The scheme will be optional for new industries, but they will have to begin production by March 31, 2002. In case of old industries availing sales tax exemption, the scheme would be made applicable for the balance period.

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