April 26, 2011 / 14:48 IST
SEZ developers fired their first salvo against the government on levy of 18.5% MAT (minimum alternate tax) on SEZs (special economic zones) in this year's budget. SEZ developers of Tamil Nadu and Andhra Pradesh have moved to Madras and Andhra Pradesh High Courts, respectively against the levy, reports CNBC-TV18.
Madras High Court today asked government counsels to appear before it on April 29th, and the Andhra Pradesh High Court is expected to list the matter tomorrow. The finance ministry and revenue department will be served a notice regarding the same.Many SEZ developers have planned an exit or conversion of SEZ approvals into residential projects since the SEZs have lost their sheen with the new tax levy.SEZ developers said that after that the MAT levy has caught them by surprise and no units are willing to set up base in the zones. SEZ developers feel that there are thousands of crores of investments in these tax free export hubs which won't be tax free any more if MAT at 18.5% is imposed.
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