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New micro and small enterprises (MSEs) in Odisha will now be exempted from payment of entry tax on purchase of raw material and acquisition of plant and machinery with the state government approving an amendment in the existing Industrial Policy Resolution (IPR)-2007.
The change will be effected on para 18.2 of IPR relating to operational guidelines on exemption of entry tax.
“The government has approved the change in IPR-2007. This will enable the new micro and small enterprises to get exemption on entry tax,” said an industries department official.
As per the revised norms, the exemption benefits will be provided for a period of five years from the date of starting commercial production. It will be subject to a ceiling of 100 per cent of fixed capital investment.
Thrust sector units, excluding deemed thrust sector units, will also be considered for a similar incentive on a case-to-case basis with the concurrence of finance department and approval of the State Cabinet. The IPR has defined thrust sectors as ones that offer huge employment opportunities, maximise value addition and have a multiplier effect in terms of ancillary and downstream linkages. The MSEs will also enjoy waiver on entry tax on acquisition of plant and machinery for setting up of industrial units. Besides this, an industrial unit seized under Section 29 of State Financial Corporations Act, 1951 and thereafter sold to a new entrepreneur on sale of assets basis and treated as new, will also be eligible for such benefits.
MSEs need to submit applications to avail the incentive on acquisition of plant and machinery within two years from the date of starting first fixed capital investment or obtaining industrial license, whichever is earlier.
To get entry tax waiver on purchase of raw materials, the units need to submit applications within six months of commencement of commercial production.
