NET ZERO IMPORTS
China
Software Companies |
1. |
Income earned up to 5 million Yuan from technological transfer in a tax year is exempted from the EIT. |
2. Income earned over and above 5 |
million Yuan is taxed @ 50 % EIT. |
3. Business tax exemption is available for |
eligible technology transfer. |
Special Economic Zones / Export Oriented Policies
India
1. No such specific singularised schemes are available in the Indian software sector.
1. 100 % tax exemption on profits earned form export for first 5 years, 50 % for the following 5 years and 50 % of ploughed back profit from export for the next 5 years.
2. Exemption from MAT.
3. External commercial borrowings by unit’ s $ 500 million in a year without any restriction of maturity through recognised bank channels.
4. Exemption from central sales tax and service tax.
5. Single window clearance for Central and state level approvals.
Carry Forward of R & D Losses
1. Tax losses attributable to R & D super deduction can be carried forward for 5 years.
1. Unused benefits can be carried forward for 8 years in case the taxpayer is in a loss.
Manufacturing Policy:
Initiatives for strategic industries
China
Chinese authorities have announced highend equipment manufacturing, biotechnology and next generation information technology as strategic emerging industries along with certain other sectors. These sectors are provided incentives and preferential policies across the spectrum.
1. Torch Programme:
a. Approved by the State Council in 1988, this initiative was aimed at building high-end industrial manufacturing zones.
b. As a result, 105 new industrial manufacturing zones were established in China by 2012 realizing an annual turnover of 5.22 trillion Yuan.
2. Innofund( Innovation fund for small and medium technology based firms) aimed at providing three forms of financing, namely, appropriation, bank loan interest subsidies, and equity investment.
i) Appropriation is provided to startups as capital for small firms founded by research personnel with their own scientific innovation, even though the
India
Large number of industries has been identified as strategic by the Government, including IT and electronic hardware industry, etc. Each of the strategic industries has received specific government policy intervention.
1. Electronic Manufacturing Cluster( EMC) Scheme
a. The EMC Scheme supports creation of world-class infrastructure for attracting investments in the Electronics Systems Design and Manufacturing Sector.
b. The scheme supports grant assistance for setting up of both greenfield and brownfield EMCs.
c. The financial assistance under the scheme is in the form of grants-in-aid only.
d. For greenfield EMCs, the assistance is 50 % of the project cost subject to a ceiling of
e. Rs. 50 crore for every 100 acres of land, and for brownfield EMCs the assistance is upto 75 % of the project cost subject to a ceiling of Rs. 50 crores.
2. The preference for domestically manufactured electronics goods policy
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