general list of tax benefits and compliance requirements for SEZ

The Special economic zones (SEZ's) are governed by separate law and table below provides for a general list of tax benefits and compliance requirements:

S.No	Nature of tax	Subject	Benefit	Compliance requirements
1	Customs Duty	SEZ can import goods without payment of customs duty for its manufacturing and trading activities.	Full exemption from all custom duties	Applicable SEZ (Custom procedure) Regulations and Customs Law
2	Customs Duty	All Capital goods, raw materials, consumables, spares, office equipments required for business within the SEZ can be imported by the unit.	Full exemption from all custom duties	Applicable SEZ (Custom procedure) Regulations and Customs Law
3	Excise Duty	All Capital goods, raw materials, consumables, spares, office equipments required for business within the SEZ can be imported by the unit.	Full exemption from all excise duties	Supply to SEZ is considered as an export in the hands of the supplier and export procedures as set out in Central Excise Notifications will have to be complied with.
4	CST	Goods can be supplied to an SEZ without CST	Full exemption	SEZ has to issue Form-I declaration
5	VAT	Goods can be supplied to SEZ under various schemes ·         Without VAT as exempt ·         With 0% rating of VAT ·         Refund at later stage The actual benefit depends upon the state VAT law and relevant notifications issued there under.	Exemption / Zero rating/Refund	Provisions as per relevant state VAT laws.
6	Service Tax	i) Specific services wholly consumed inside the SEZ are exempt from service tax ii)                  Specific services used in relation to authorised operation in the SEZ qualify for refund of service tax in hands of SEZ unit.	Full exemption or refund mechanism	Notification 17/2011
7	Income Tax	Benefits under Section 10AA of Income Tax Act,1961	Profits	Requirements of Section 10AA.