PACKAGE SCHEME OF INCENTIVES 1997 - LARGE & MEDIUM SCALE INDUSTRIES

1.     State Capital Investment Subsidy

1.1    State Capital investment Subsidy will be provided at the rate of thirty percent of the fixed capital investment subject to a ceiling of Rs. 20 lakhs.

2.     Subsidy for the Cost incurred on preparation of Feasibility Study and preparation of Project Report

Subsidy will be provided at ninety percent of the cost of preparation of feasibility/project reports subject to a ceiling of Rs.2 lakhs provided that the report is prepared by a Government approved agency.

3.     Interest subsidy

3.1    A subsidy on interest payments to Banks/Financial institutions will be provided at the rate of four percent on term loans (excluding working capital loans) availed by an entrepreneur for setting up of approved industrial units. This is subject to a maximum of Rs.20,000/- per month for 3 years from the date of disbursement of the loan and to be applicable only for new units.

3.2.   This subsidy will be in the form of re-imbursement of the actual repayments made.

4.      Local Employment Promotion Grant

4.1.    Government will reimburse annually up to thirty percent of the realistic wage bill for local tribal employees over and above the stipulated number of local tribal employees in the industrial policy as specified in the eligibility criteria. This would be for three years from the date of entertainment. The maximum limit of such subsidy is Rs. One lakh annually.

4.2     Twenty percent of the cost incurred on training of local tribal employees will be reimbursed subject to the following :

1. Such trained person being absorbed in the unit, failing which the unit will refund the subsidy amount paid for the same.

2. Training is conducted in an Institute approved by the State Government

5.      Subsidy on Power

5.1.    Subsidy on power tariffs will be provided at the rates of thirty percent and twenty five for loads upto 2 MW and loads above 2 MW respectively, for a period of five years from the date of commercial production and the maximum limit of such subsidy is Rs.7 lakhs annually. Power subsidy will only be allowed on actual consumption of power for the manufacturing process substantiated withal requisite details and diagrams etc.

Provided that in case of a Tourism unit, the power subsidy will be allowed on actual consumption of power by such a unit.

5.2.    Drawal of Power Line

In case a project is located in an area which required the drawal of a power line of 33 KV and above, then State Government will reimburse the cost incurred on the drawal of such power, including the cost of transformer, subject to a ceiling of Rs.5 lakhs an provided that the location has been approved by State Government.

6.      Subsidy on cost incurred on quality control measures

Cost of Laboratory equipment for the purpose of quality control and ISI certification, subject to a maximum of Rs. 40,000/- per unit will be reimbursed in cases where it does not form part of the project cost.

7.      Subsidy on cost incurred on Pollution Control Measures

Fifty percent of the cost of approved pollution control measures will be reimbursed upto a maximum of Rs.75,000/- per unit.

8.      Sales Tax Exemption [Replaced by The Meghalaya Industries (Tax Remission) Scheme, 2006]

Sales Tax will exempted on sales of finished products for a period of seven years from the date of commercial production.

Provided that in case of a Tourism Unit, such Sales Tax Exemption will relate to the applicable tax payable on services rendered by the unit.

9.      Refund of Central Sales Tax (CST) [Replaced by The Meghalaya Industries (Tax Remission) Scheme, 2006]

Units will reimbursed the amount of CST actually paid on purchases of such machinery and equipments as is installed upto the date of commissioning of the unit.

10.     Additional Sales Tax Incentives [Replaced by The Meghalaya Industries (Tax Remission) Scheme, 2006]

Approved project may, in lieu of State Capital investment subsidy, be entitled for a remission of State Sales Tax for an additional period of 4 years but limited to the amount of capital investment subsidy, otherwise eligible. This additional incentive will be in the form of reimbursement.

11.     Exemption from Stamp Duty

Approved projects with fixed capital investment not exceeding Rs.5 crores will be exempted from Stamp Duty upto 75 % of the applicable amount to assist execution of deeds of conveyance / mortgage pertaining to loans from financial institutions and banks.

12.     Special incentives for Export Oriented Units

a.    100 % Export Oriented Units (EOUs)

1. An additional 5 % capital investment subsidy subject to a maximum of Rs. 5 lakhs.

2. Sales Tax exemption for an additional period of one year.

b.    Other Units with an export commitment of 25% and above of the total turn over.

1. An additional 5% capital investment subsidy subject to a maximum of Rs. 5 lakhs.

Provided that in case of a Tourism Unit, the export commitment shall be replaced by “ commitment to earn Foreign Exchange”

13.               Pioneer Units Scheme

13.1.        A new industrial unit with fixed capital investment exceeding Rs.3 crores set up in district where there are no medium/large scale industries will be given pioneer status. A pioneer unit will be entitled to an additional capital investment subsidy of five percent, subject to a ceiling of Rs.15 lakhs.

13.2.        Only the first three units for any district will be eligible for the pioneer unit status.