The government has decided to write off 90 per cent stamp duty for IT companies as they would be entitled to pay a paltry 10 per cent of the 0.7 per cent of the market value of shares. The government's decision will help the proposed Global Tele Systems merger with its subsidiary, Global E-Commerce.

The government has decided to continue the provision of 10 per cent of the value of shares during the imposition of stamp duty for mergers, demergers, amalgamations, restructurings and reconstruction exercises. In case of the merger of banks, these would have to pay stamp duty worth 7 per cent of the fixed assets or 0.7 per cent of the market value of shares, whichever is higher. This has set at rest, speculations and will largely benefit the merger of Times Bank with HDFC Bank.

Similarly, the Tatas, which have paid a Rs 60 crore stamp duty for the merger of Tata Electric Companies (TEC) would not have to pay more.Maharashtra chief minister Vilasrao Deshmukh told reporters that the government had received various representations in this regard from industry. He further added that the government had responded to them positively by offering these sops as in the present situation, sales tax sops were not possible because of the implementation of a uniform floor rate of sales tax all over the country.

As far as the demerger of Nocil is concerned, the company will have be covered under the amended provisions of the Bombay Stamp Duty Act. Had these amendments been made, the company would have to pay a whopping Rs 500 crore towards stamp duty as the total demerger needed nearly Rs 5,000 crore in stamp duty, sources added.

Meanwhile, the state government has directed its undertaking, the City and Industrial Development Corporation (Cidco), to carry out techno-economic and environment impact assessment studies for the Rs 4,000 crore international airport project near Panvel-Ulwa. Mr Deshmukh said that Cidco has been asked to appoint consultants to complete these studies in six months.

These would be later submitted to the Centre for final approval. The project would be taken up on a build-operate-transfer basis.

Mr Deshmukh strongly justified the need for a second international airport and said that tourist traffic would increase by 12.5 million, comprising 4.5 per cent of international tourists and 6 million domestic tourists annually by the year 2005. "The tourist tariff will get choked by 2007 and thus the second international airport is a must and has even recommended by the Airports Authority of India (AAI)," he added.

Mr Deshmukh said that so far, nearly 60 per cent of the 950 hectares of land needed for the project has been acquired by Cidco and added that the rest would be acquired soon. The chief minister added that a decision of picking up certain equity by Cidco would be taken after receiving reports from the consultants.