Commerce, Finance ministry disagree over SEZ forex earning rule
New Delhi: The finance and commerce ministry seem to be at loggerheads over the issue of of introducing an additional export obligation. The eGoM on SEZs had said that in addition to the existing criteria requiring SEZ units to be net foreign exchange earners, it should be examined whether another obligation requiring units to export goods equal to the value of inputs bought by them from the domestic tariff area (DTA)could be imposed.

When an export obligation is imposed on a unit, it is committed to carry out exports - depending on the level of obligation imposed - in return for the various concessions. The finance ministry feels the current export obligation requiring SEZ units to be net foreign exchange earners is not enough to ensure adequate exports. The commerce ministry, however, believes the net foreign exchange criteria should be enough provided checks are introduced to rule out foul play.

Commerce ministry officials said they realised the need to prevent misuse of rules. One possible misuse could be that an SEZ unit could set up a subsidiary in the DTA and source goods from it with the DTA unit claiming concessions in lieu of the deemed exports made to the SEZ unit.

To prevent such cases, the commerce ministry has suggested that in case a DTA unit is fulfilling its export obligation by supplying goods to an SEZ unit, the value of sales should be added to the SEZ unit's export obligation. The finance ministry argues there could be units that are not importing at all, and which would not have to export anything if the export obligation is restricted to units being net foreign exchange earners.
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Tax collections at Rs4,70, 077-cr
New Delhi: The government's tax collections have risen to Rs4,70,077 crore, exceeding the revised revenue estimates for 2006-07 by about Rs5,000 crore, thanks to high economic growth and partial revamping of tax administration.

Finance Minister P Chidambaram said while releasing tax collection figures on Saturday. that as against Rs2,29,533 crore budgeted estimates for indirect collections, and revised estimates of Rs2,36,202 crore, the actual collections including customs, Central excise and service taxes reached Rs2,40,896 crore in 2006-07. Personal income tax collections touched Rs85,620 crore and corporate tax Rs1,43,561 crore for the same period.
The Finance Minister said the actual direct tax collections turned out be to Rs2,29,181 crore as against the revised estimate of Rs2,29,007 crore.

Customs tax collections of Rs86,294 crore also exceeded both budgeted as well as revised estimates of Rs77,066 crore and Rs81,800 crore respectively.

Revised estimates of Central excise collections, which were lowered from Rs1,17,967 crore to Rs1,16,233 crore, were also surpassed as figures touched Rs1,17,250 crore for 2006-07.

Service tax collections of Rs37,352 crore were, however, lower by Rs817 crore as against the revised estimates of Rs38,169 crore for the fiscal.
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Govt rapped over disinvestment
New Delhi: A Parliamentary panel has expressed concern over the government's decision to sell stake in three power companies, despite its announced stance of keeping all proposals and decision relating to disinvestment on hold.

The panel said despite the assurance given and reiteration of the committee's recommendation for bringing out a policy document spelling out the disinvestment policy approach, goals and objectives, the government has been unable to come with the same till date.

Expressing "anguish", it said despite its stance, the government on February 8 proposed to back the "offer of sale" of 10 per cent, 5 per cent, and 5 per cent of shareholding by the Rural Electrification Corporation, Power Grid Corp, and National Hydroelectric Power Corporation respectively.

The panel said it wants a clear policy on disinvestment. It is of immense national importance in terms of utilising proceeds for funding social welfare projects and capital investment requirement of profitable PSUs was not being enunciated by the government, the report said.
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