A depressed economy coupled with a business class not enthused in investing in new projects in the State. This is the situation in Goa at present. This also means a dramatic drop in the generation of new jobs, something which is required in a State with a young population, a population, which needs jobs pronto.
The Goa Chamber of Commerce and Industry, among other stakeholders, wants the State government to look at certain sectors with interest in the State budget set to be tabled on Wednesday.
Power: With Goa regularly paralyzed by power outages the State should ensure energy security by supplying quality power on 24×7 basis to meet contracted demand. Business associations suggest that to achieve better operational efficiency and financial accountability, the State must restructure the present Electricity Department into independent Transmission and Distribution Companies (as provided under Electricity Act-2003) with separate Boards with full financial and administrative autonomy. As many new units are likely to be attracted to the State following the new Investment Policy and the demand for power in the State will rise, the State should set up a clean fuel-based power plant to meet at least 50% (about 375MW) of its projected demand in 2016-17, the associations suggest. For this purpose the State must actively seek allocation of natural gas from GAIL gas pipeline coming into Goa.
Mass transport: Business groups want traffic light systems in appropriate locations, improvement of mass public transport system. They suggest a metro railway connecting business and commercial centres that should ideally start at Mapusa and go on to Cortalim via Panjim. Cortalim should be a junction from where metro lines should connect to Vasco and Margao, besides a fast metro/railway/bus connectivity between upcoming Mopa Airport and Mapusa/Panjim/Margao/Vasco. They also suggest that no permissions be given to fairs and exhibitions where adequate parking space is not available. With the closure of the Zuari bridge for heavy traffic leading to problems, business associations have proposed the introduction of a RO-RO ferry service across Zuari river.
Infrastructure: To improve infrastructure to the ports four-laning of NH-17B is a suggestion so that port traffic can bypass Vasco. They also state that railways be persuaded to enhance the connectivity to double line broad gauge as the single broad gauge link through the State is inadequate. They also suggest exploring the possibility of connecting Dabolim Railway Station to the Airport and a multilevel parking facility for private vehicles and creation of suitable parking for public transport.
Waste Management: With there being no facility within the State to manage industrial/e-waste/bio-medical waste, the business associations seek that the planned facility at Dharbandora be expedited, for which a budgetary provision be made. They also suggest setting up village and city level segregation and treatment facilities instead of common central facilities and facilitate the establishment of waste recycling plants which will provide business and job opportunities to locals.
Mining: Seeking the commencement of legal mining operations with proper regulation, they have suggested that the hike in the registration charges be reconsidered and peg the same to 10-15% of stamp duty paid as the demand for the low-grade iron ore from Goa has drastically dropped and mines operating from Australia and Brazil have captured substantial market share, which hitherto belonged to the mining lessees from Goa.
Manufacturing: With no new and substantial investments seen in the manufacturing sector in the last 5 to 7 years and the growth of this sector stagnant at around 35% of the State GDP, businesses have sought the extension of the NPV scheme for a further five years and a similar scheme to all new units so as to attract fresh investments.
Value Added Tax: Given the current depressed market conditions and considering that there is no other tax benefit available to the manufacturing units in the State, Goan units are finding it difficult to compete with their counterparts in the rest of the country, business associations have sought a NPV-like tax exemption scheme to attract investment.
Stamp Duty
Issue I
Stamp duty on power of attorney: The stamp duty on a power of attorney given to a promoter or developer for construction, development, sale or transfer of immovable property, is same as is leviable on a conveyance under clause (a) or (b), as the case may be, of Article 22, on the market value of the property – facility of remission of this stamp duty is not available.
Implications: This is an additional burden, which increases the cost of construction that is already high.
Recommendations: Extension of the facility of remission of 2.9 per cent in the cases where POA is made in lieu of sale deed.
Issue II: In terms of 7/13/2013-LA dated 22/05/2013, conversion of a partnership firm or a limited company into a LLP, attracts stamp duty at the rate as is leviable on a conveyance, calculated on the market value of its assets.
Implications: It is a deterrent to partnership firms and/or limited companies to take the benefit offered by conversion to LLP.
Recommendations: Any firm changing its constitution from partnership or limited company to LLP with same partners or shareholders be exempted from stamp duty.
Infrastructure Tax: Infrastructure tax is collected by TCP while issuing approvals to projects. The tax is levied for providing infrastructure like roads, water, power, sewerage etc. However, the tax is high and most of the infrastructure is either poor or not made available.
Implications: Builders have to themselves work to get the infrastructure – build approach roads to their properties, provide for conductors, cables and transformers.
Recommendations: Infrastructure tax be converted into cess and rates be lowered by 50 per cent. The cess must be shared with municipal corporations, municipalities, panchayats, PWD, electricity department etc., to provide the necessary infrastructure.
