Start Of Electricity Generation By Ipps
Power ministry seeks more time for availing tax benefits
The power, energy and mineral resources ministry has sought time extension by two years for starting commercial operation by the independent power plants for availing tax benefits, officials of the National Board of Revenue said. According to the existing rule, the private power generation companies which will go for commercial production by June 2016 will enjoy full tax exemption on its income and other tax-related facilities for 15 years from the date of the start of commercial operation.
NBR officials said that state minister for power, energy and mineral resources ministry, Nasrul Hamid, wrote a letter to the finance minister and the chairman of the revenue board seeking extension of the deadline for starting commercial operation until December 2018.
In the letter, Nasrul argued that the government should extend the benefit for continuation of participation of the private power generation companies to meet the gradually increasing demand for electricity in the country.
He said that prime minister Sheikh Hasina also approved a proposal of the ministry in this regard.
The government has set a target of producing a total of 24,000MW electricity by 2021 and the private sector participation is the most important issue in executing the plan, he said.
In November 2013, the revenue board extended the deadline of commercial production date by two years upto June 2016 from December 2014.
Officials of the revenue board said that they would take necessary steps on extending the deadline in line with the finance ministry’s instruction as earlier it had rejected such proposal.
They said that the tax benefit should not be offered for an unlimited period and the facility should be time-bound as many power companies were making delay in starting commercial production.
Power ministry officials said that the extension of the deadline for the tax break would encourage new power companies to come in the power generation business.
There were, however, no conditions such as specific time bar for starting commercial production within specific date in the Private Sector Power Generation Policy under which the government floated tenders for setting up power plants, they said.
Initially in 1999, the NBR offered tax exemption to the companies without giving such condition, they added.
-With New Age input
