Bihar mulls extra subsidies and tax exemptions for IT industry
The state government is mulling extra subsidies and tax exemptions for information technology (IT) sector to attract investment to Bihar.
It plans to offer hefty subsidies and rebate in electricity tariffs especially for this sector. “We are quite serious about the prospects of IT industry in the state,” says a senior official, “Bihar is one of the most suitable places for this sector in the country today. We have a responsive government and a big pool of skilled manpower. Therefore, we want the IT and ITeS companies to come to Bihar and invest here. To facilitate that, we have decided to offer a slew of incentives.”
The state government is mulling to offer this sector 50 per cent capital subsidy with a cap of Rs 3 crore. It will be 50 per cent higher than what it offers to other industrial units.
Apart from that, the state government is also planning reimbursement on central cess and sales tax. It has already announced reimbursement on VAT and entry tax for this sector for 10 years. It may also offer prospective investors land at a subsidised rate.
One of the biggest subsidies the state government is planning for such investor would be on electricity tariff. “Since electricity is a vital raw material for these units, we are working on a formula to take off some of their cost,” said the official. The state government may offer up to 25 per cent rebate in their energy bills for three years, he added. These subsidies and tax exemptions would be announced by the state government after the general election, says the government sources. The state government is hopeful that these incentives would help it in winning over some of the big names in the sector.
“We may have been bit late in joining the IT revolution in the country, but we are here now and we want people to acknowledge us. Coming to Bihar would be a win-win scenario for both the state and this sector. Bihar offers low cost operations and continuous supply of highly trained workforce. On the other hand, these companies would provide jobs and help in developing the state.”
The state government is aiming for Rs 5 lakh crore worth of investment in next five years, which could provide employment opportunities for more than 5,000 youths.
Source: Business Standard