By Mario Andree
Ceylon FT: India's Tata Housing's US$ 430 million project, of which only US$ 130 million would come in the form of foreign direct investment, has been identified as a Strategic Development Project and the country's investment promotion agency has decided to grant a 16 year tax break as a good-will gesture.
The Ministry of Defence and Urban Development gave five acres to Tata Housing free of charge as the company promised to develop 562 housing units and 100 shopping units on the balance three acres cleared in Slave Island.
In a Gazette notification the Ministry of Investment Promotion identified Tata's US$ 429.5 million re-development and mixed development project as a Strategic Development Project under the SDP Act.
According to the Gazette only US$ 130 million out of the US$ 429.5 million would come in the form of foreign direct investment.
The ministry also has decided to grant the company a 16 year tax break for the project which would be completed within eight years from the date of signing the MoU with BOI.
Accordingly, the company will be fully exempted from income tax for the first 10 years, other than sale of apartments which is accepted for six years, followed by 50% exemption of corporate tax for six years.
In addition, no withholding tax would be charged on interest for foreign loans, fees to consultants, management and royalty fees below three per cent of gross revenue and 1.5% of marketing fees and further incentives for management fees below 10%.
The company has been exempted from VAT, PAL, Excise Duty, CESS and NBT during the project implementation period of eight years.
Further, the company has been exempted from the payment of Construction Industry
Guarantee Fund Levy to the contractors and subcontractors of the project company.
The project will be carried out by locally incorporated One-Colombo Project (Private) Limited.
At the initial stage the company would construct 562 housing and 100 shopping units to relocate those displaced by the land clearance. The relocation is expected to be completed within two-and-a-half years of commencement, followed by the second phase where the company would develop a mixed development project consisting of a 150-room city hotel, 1.1 million sq. ft. of residential apartments, 530,000 sq. ft. of commercial space and 115,000 sq. ft. of retail space.
www.ceylontoday.lk
Ceylon FT: India's Tata Housing's US$ 430 million project, of which only US$ 130 million would come in the form of foreign direct investment, has been identified as a Strategic Development Project and the country's investment promotion agency has decided to grant a 16 year tax break as a good-will gesture.
The Ministry of Defence and Urban Development gave five acres to Tata Housing free of charge as the company promised to develop 562 housing units and 100 shopping units on the balance three acres cleared in Slave Island.
In a Gazette notification the Ministry of Investment Promotion identified Tata's US$ 429.5 million re-development and mixed development project as a Strategic Development Project under the SDP Act.
According to the Gazette only US$ 130 million out of the US$ 429.5 million would come in the form of foreign direct investment.
The ministry also has decided to grant the company a 16 year tax break for the project which would be completed within eight years from the date of signing the MoU with BOI.
Accordingly, the company will be fully exempted from income tax for the first 10 years, other than sale of apartments which is accepted for six years, followed by 50% exemption of corporate tax for six years.
In addition, no withholding tax would be charged on interest for foreign loans, fees to consultants, management and royalty fees below three per cent of gross revenue and 1.5% of marketing fees and further incentives for management fees below 10%.
The company has been exempted from VAT, PAL, Excise Duty, CESS and NBT during the project implementation period of eight years.
Further, the company has been exempted from the payment of Construction Industry
Guarantee Fund Levy to the contractors and subcontractors of the project company.
The project will be carried out by locally incorporated One-Colombo Project (Private) Limited.
At the initial stage the company would construct 562 housing and 100 shopping units to relocate those displaced by the land clearance. The relocation is expected to be completed within two-and-a-half years of commencement, followed by the second phase where the company would develop a mixed development project consisting of a 150-room city hotel, 1.1 million sq. ft. of residential apartments, 530,000 sq. ft. of commercial space and 115,000 sq. ft. of retail space.
www.ceylontoday.lk
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