India raped by UPA
by Nitin Kumar on Jul 21, 2007 02:35 PM
As per SEZ law, a private company can approach GoI (Ministers/IAS) with a proposal to setup SEZ in a particular area. If the Ministers and IAS approve that proposal, then policemen will force everyone in that area to move out, and hand over that land to that company. The compensation offered in will be decided by IAS and then may be increased judges. But reality will be that compensation will be peanuts.
SEZ will have some export commitments. And in return they will get ALL sorts of tax exemptions. For 5 to 10 years income tax will be zero. And I am sure, they will bribe MPs after 10 years to extend the 10 year limit by another 10 years. The sales tax, excise, customs, VAT, octroi and all the taxes on SEZ will be zero. There wont be any stamp duty either.
The labor laws will be separate (full hire-fire).
Some states like Gujarat will have separate liquor laws as well. Some states are even contemplating of allowing gambling in SEZ and other entertainment like bar and dance bars (euphemism to commercial sex) in SEZ.
Now if Mr. X exports goods from a non-SEZ area, he will have to pay all the taxes, while if Mr . Y exports same from SEZ, he wont pay any taxes. So SEZ is NOT for export promotion or to get foreign exchange. If we need foreign exchange, a simple law which states that "deposit $ X in RBI and get TRANSFERABLE tax credits of Rs K* , where K is some number decided by GoI".
But SEZ is more of cornering opportunities. It is easy to see that only with connections will
