Govt approves SEZ amendment Bill 2019

The Union Cabinet, chaired by the Prime Minister Narendra Modi, has given its approval for implementation of the Special Economic Zones (Amendment) Bill, 2019 in the ensuing session of Parliament. The bill will replace Special Economic Zones (Amendment) Ordinance, 2019, which was promulgated in March, 2019. The ordinance had paved the way for trusts to set up units in special economic zones (SEZs).

After an amendment of a section of the SEZs Act, 2005, a trust or any entity notified by the central government will be eligible to be considered for grant of permission to set up a unit in these zones, which enjoy certain tax and other incentives. The amendment also seeks to provide flexibility to the central government to include 'trusts' in the definition of a 'person', any entity that the central government may notify from time to time. This will facilitate investments in SEZs.

SEZs are major export hubs in the country as the government provides several incentives including tax benefits and single-window clearance system. The developers and units of these zones enjoy certain fiscal and non-fiscal incentives such as no licence requirement for import; full freedom for subcontracting; and no routine examination by customs authorities of export/import cargo. They also enjoy direct and indirect tax benefits. Exports from SEZs paced up about 15 percent to Rs 5.52 lakh crore in 2017-18.