Fresh lease of life likely for power tax holidays
The biggest beneficiary will be state-owned NTPC, while projects by Sterlite, Adani, Indiabulls, Jindal Power, Lanco, GMR and state utilities also could avail of the tax sop. Tata Power’s Mundra UMPP might benefit too as it is likely to get fully commissioned by December 2013. A few private sector transmission projects could benefit as well. It is expected that about 12,550 MW of capacity based on linked coal would be commissioned in 2013-14.
Including some capacities being created based on captive coal, the figure could go up to over 16,000 MW.
The finance ministry, sources said, has agreed to provide a special facility to power plants coming up in 2013-14, despite the Direct Taxes Code Bill, which does not have a tax holiday provision, being in Parliament. The DTC is likely to take effect in April 2014 and the principle that underlies the code allows for a broadening of the tax base, while keeping few exemptions/deductions. While there is a policy focus on infrastructure investments, the government’s economic policy advisers including the Prime Minister’s Economic Advisory Council have repeatedly stressed the need to spur capacity creation in
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