Tax concession for export profits
Finance (No. 2) Act, 1962
By way of Rebate of tax
- Section 2(5) of the Finance (No. 2) Act, 1962 provides for a tax concession in the case of profits derived from the export of goods or merchandise out of India. This tax concession will be admissible in the case of all assessees except companies which have not made the prescribed arrangements for the declaration and payment of dividends within India. The tax concession has been given in the form of a rebate of tax which will be equal to the income-tax and super tax calculated respectively at one-tenth of the average rate of income-tax and the average rate of super tax on the amount of export profits included in the total income. If the export profits are set off against any losses in the process of computing the total income, no tax concession will be available. Rules will be issued shortly laying down the method as to how the amount of such export profits should be computed in a case where the assessee derives income by sales in India in addition to income from exports.
Finance (No. 2) Act, 1962
- It should be noticed that this tax concession will be available only to the person who exports the goods or merchandise out of India. If a manufacturer himself exports the goods or merchandise out of India, he will get the benefit of this concession. But if he sells such goods or merchandise to another merchant or manufacturer in India who in turn exports them out of India, it is the latter and not the former who will get the benefit of the tax concession.
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