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India By State - Manipur - Taxation & Legalities




Taxation & Legalities

Taxation & Legalities

Policies & Incentives

The North East Industrial and Investment Promotion Policy (NEIIPP), 2007, was implemented to promote the North East as an attractive investment destination through concessions and incentives.

The policy offers many incentives for potential investors:

  • Industries under this policy are eligible for incentives for a period of 10 years from the date of commencement of production
  • All new units as well as existing units that undergo substantial expansion ( a minimum of 25 per cent increase in fixed capital) and start production before 2017 would qualify for state incentives.
  • Along with the NEIPP the North East Industrial Development Finance Corporation (NeDFI) will act as the nodal agency for disbursal of subsidies.
  • 100 per cent excise duty exemption on finished products made in the North East.
  • 100 per cent income tax exemption for industrial units.
  • Capital investment subsidy increased from 15 to 30 percent for plant and machinery up to US$ 360 000 per unit. For units above US$ 360 000 and up to US$ 7.5 million, an empowered committee approves. For units above US$ 7.5 million, the union cabinet approves.
  • Interest subsidy to be given at the rate of 3 per cent on working capital
  • 100 per cent reimbursement of insurance premium.

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New Industrial Policy, 2002 was introduced to facilitate rapid and substantial industrial development in the state through enhanced investment, infrastructure and institutional support, incentive packages and utilisation of existing resources. The policy was introduced to:

  • Create necessary conditions for maximum possible utilisation by tapping locally available raw material and human resources for industrialisation.
  • Develop industrial infrastructure in selected areas by providing common facilities in a compact area for specialised categories of industrial units.
  • Promote export oriented industries with a view to exploit the emerging market opportunities in the neighbouring countries.
  • Develop marketing facilities for industrial products.
  • Develop village and small scale service and business enterprises (SSSBE) to provide self-employment to educated youths.
  • Revive and rehabilitate sick industrial units in the state
  • Expedite formalisation and development of cross border trade with Myanmar.
  • Provide investor-friendly environment by removing procedural bottlenecks and legal hurdles.
  • Develop and promote the tourism industry in the state.
  • Enhance value addition in products and processes through rapid technology upgrades.
  • Encouraging quality control, standardisation, and competitiveness of the local products.
  • Encourage industry based on medicinal plants, and research and development in the field.
  • The state government has declared that it will make efforts to provide developed land with infrastructural facilities and undeveloped land to manufacturing industrial units only including village industries sector.
  • Developed land will be allotted on hire purchase basis with suitable terms of instalments, subsidising the cost of land development as:
    • 25 per cent for small scale industry units.
    • 30 per cent for export-oriented units (EOU) and units owned by weaker sections
    • 15 per cent for large and medium units

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  • Available sheds will be provided to SSI units in infrastructural centres on monthly rental basis. Subsidy on the monthly rent will be provided at 50 per cent for entrepreneurs of all categories and 55 per cent for the EOUs and units set up by weaker sections.
  • Subsidy at US$ 215 per trainee or 50 per cent of the actual cost of training shall be provided to industrial units which depute their workers for technical training in government recognised or other reputed training institutions.
  • Industries established in thrust sectors will be provided 30 per cent subsidy on the total capital investment on plant and machinery and miscellaneous fixed assets subject to ceiling of US$ 30,000 per unit. For EOUs, the rate of subsidy shall be 35 per cent subject to a maximum of US$ 40 000 per unit.
  • SSIs will be provided an interest subsidy of 5 per cent per annum on working capital and term loan taken from banks and financial institutions.
  • Power subsidy will be provided for SSI units for the first five years from the date of commercial production of the unit at the rates fixed by the government from time to time.
  • Subsidy of 50 per cent will be admissible to meet the cost of feasibility study and project report preparation subject to a maximum ceiling of US$ 1,085 in each case.
  • Subsidy of 50 per cent will be admissible to meet the cost of technical know how obtained by SSI unit from organisations approved in advance by the Government of Manipur.
  • Individual units purchasing of raw materials directly, a concessional rate of 4 per cent of value of raw materials will be admissible as full tax set-off against any sales tax paid by them.
  • SSI units, village and cottage industrial units will be reimbursed in full the stamp duty and registration fee for securing loans and other incentives from financial institutions.
  • A state capital investment subsidy for the purpose of modernisation/expansion/diversification at the rate of 15 per cent or US$ 2,000, which ever is less, will be admissible for the purchase of plant and machinery.
  • All eligible units get exemption from payment of earnest money and security deposits on items for which they are registered on tender by the state government agencies.
  • All IT industries employing a minimum of 25 persons would be entitled to 50 per cent concession on floor space rentals for a maximum of five years and all It industries set up by local entrepreneurs would be given 50 per cent concession on floor space rentals for a period of two years.

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Manipur IT Policy, 2003

The IT policy was introduced in 2003 to try and transform Manipur into an information technology driven economy. The policy set out to set up the institutional framework to implement and monitor IT Policy. E-Governance would be used to upgrade the standard and quality of administration and to provide citizen-oriented, efficient and cost-effective government. The policy aimed to encourage investment and growth in the IT industry with a target of increasing the contribution of IT in the economic growth of the state.

Some of the initiatives to take place under the IT policy are:

  • The state is to establish a backbone network- Manipur State Wide Area Network (MAN-NET) - for voice, data and video transmission and dissemination.
  • Internal communication to be improved by increasing the use of email, bulletin boards and video-conferencing in the government.
  • Increasing IT literacy in schools and colleges, internet in educational institutes, distance education through IT, setting up and training centres for unemployed, training of teachers, setting up community information centres are some of the initiatives on the IT education side.
  • The state government shall endeavour to provide continuous and uninterrupted power supply for IT industries.

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